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The Perley and Rideau Veterans’ Health Centre BOARD GOVERNANCE GUIDE FOR DIRECTORS

VOL III – GOVERNANCE / Part 4 – Stewardship: Guidance for Good Governance / OVERVIEW (Board Approved 06Feb2014) of 3

VOLUMEIII‐GOVERNANCE

PART 4 – STEWARDSHIP: GUIDANCE FOR GOOD GOVERNANCE

OVERVIEW Stewardship embodies responsible planning and management of resources. In effect, the Board of Directors, as governors, is charged with a mandate to be the stewards for the property and mission of the Perley Rideau. Sound stewardship goes well beyond fiduciary oversight to ensure compliance with legal requirements. It also includes ensuring the long-term sustainability of the Perley Rideau and meeting the public’s growing expectations for integrity, accountability, and transparency by not-for-profit health service providers. Purpose This Part provides wide-ranging guidance to Directors and Committees for the effective stewardship of all the Perley Rideau’s assets in such areas as the mission, strategic planning, risk management, reputation, and performance management. Usage The material reflects best practices for not-for-profit boards. It is reference material, meant to be instructive rather than prescriptive or directive. New Board members should find it useful in orienting their thinking as to the types of things the Board should be considering, as opposed to those things that management should be executing. While all chapters should be helpful in a general way to all Board members, many chapters have a close alignment with the areas of responsibility of specific Committees. These chapters should be instructive for these Committees, particularly for Directors appointed to that Committee who lack related professional expertise. Where applicable, the chapters include selected passages from Accreditation Canada’s Standards for Sustainable Governance to remind Directors of the governance standards against which the Perley Rideau is routinely evaluated. In addition, most chapters include at least one review checklist to assist members in annually assessing the effectiveness of the Board’s performance in that aspect of its governance.



Layout The eight chapters of this Part address:

Chapter 1 – Governance This chapter discusses governance in a general sense, including the role of the Board in governance and differentiating the roles of the Board from those of management. It provides seven guiding principles for determining those issues that most require Board attention. Is the Board doing the right things for the right reasons? It concludes with a discussion of Accreditation Canada’s Standards for Sustainable Governance and includes two further review checklists to assist the Board in assessing the effectiveness of the Board’s governance.

Chapter 2 – Strategic Planning and Management

Setting the corporate direction is one of the principal functions of the Board. This chapter provides comprehensive guidance for the strategic planning process, including a differentiation between Board and management responsibilities in this process. Beyond promulgation of the strategic plan, there is a need to manage the consequential activities such as the effective communications of the strategic plan so as to have the desired impact on organizational performance. The chapter also provides guidance for the review and assessment of progress in meeting the strategic directions and fulfillment of the vision. In addition, a checklist is provided to assist the Board in auditing its own effectiveness with respect to strategic planning and management.

Chapter 3 – Quality

The Perley Rideau is committed to the delivery of health services that meet or exceed all applicable standards and regulations governing the provision of health care for our residents and other clients. This chapter looks at quality from different perspectives, including the Board’s responsibilities for maintaining organizational quality and continuing improvement. It reviews the responsibilities of the Quality of Life and Safety Committee and provides guidance on quality management, performance monitoring and safety management. The Chapter also includes a review checklist to assist the Quality of Life and Safety Committee in evaluating its own governance performance.

Chapter 4 – Financial Stewardship

Notwithstanding that some Board members have professional credentials in the financial field, most do not. This chapter provides a primer in the fundamentals necessary to understand financial statements, internal controls and the audit process. This chapter also outlines six basic building blocks for effective financial stewardship including: organization; planning; policies, process and guidelines; performance monitoring; external audit; and accountability. A review checklist for financial stewardship is also appended to assist the Board in evaluating its governance effectiveness in this area.



Chapter 5 – Human Resources Stewardship Recognizing that managing the day-to-day aspects of maintaining an effective workforce is the responsibility of the CEO, this chapter defines three key areas of related Board responsibility. It outlines several principles to be followed by management in formulating Perley Rideau HR policies and provides guidance to the Board for overseeing the Perley Rideau’s HR policies and practices. The chapter concludes with guidance for the periodic review and audit of the effectiveness of the Perley Rideau’s HR stewardship.

Chapter 6 – Stakeholder Relations

The Perley Rideau is accountable to many diverse stakeholder groups, some of them vital to the long-term viability of the Perley Rideau. This chapter addresses three broad functions essential to the effective maintenance of constructive relationships with these stakeholders (i.e. relationship building, public communications and advocacy). It addresses the respective responsibilities of the Board as well as of individuals in meeting these expectations, and includes guidance for the Board and for the Stakeholder and Community Relations Committee for assessing the Board and the Perley Rideau’s effectiveness in establishing and maintaining effective relationships with these groups. .

Chapter 7 – Enterprise Risk Management Maintenance of the viability and integrity of the Perley Rideau is a core responsibility of the Board. In spite of the best strategic planning and organizational effort, things that can go wrong do and reality deviates from assumptions and intentions. This chapter outlines the Board’s role in managing the various dimensions of risk facing the Perley Rideau. It provides guidance for preparing for risk, preventing risk, and protecting against risks, and it discusses risk acceptability and risk tolerance. Since risk arises in virtually all aspects of the Board’s oversight, it is something that must be addressed by all Board Committees. To that end, a review checklist is provided to guide the Board and its Committees in assessing the effectiveness of its risk management practices.

Chapter 8 – Performance Management

One of the Board's responsibilities is to oversee the performance of the Perley Rideau, especially in terms of quality of care and services and of financial condition. This chapter identifies six key areas of Board responsibility for performance monitoring. It reviews several factors affecting the design of a suitable performance management system from a Board perspective and provides guidance for the Board in the use of performance monitoring reports. Finally, it includes a review checklist for the Board to evaluate the effectiveness of its performance monitoring system.

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VOL III – GOVERNANCE / Part 4 – Stewardship: Guidance for Good Governance / Ch 1 – Governance (Board Approved 06Feb2014; Revised 03Apr2014; Revised 07Sept2017) Page 1 of 23


Chapter 1

GOVERNANCE

This chapter discusses the role of the Board in governance and differentiates the roles of the Board from those of management. It provides guiding principles for determining those issues

that most require Board attention.

1.1 GENERAL

Governance may be defined as the exercise of authority, direction, and control of an organization in order to ensure that its purpose is achieved. It refers to who is in charge of what; who sets the direction and the parameters within which the direction is to be pursued; who makes decisions about what; who sets the performance indicators, monitors progress and evaluates results; and who is accountable to whom for what? Governance includes the structures, responsibilities and processes that the Board uses to direct and manage its own operations. The structures, processes and organizational traditions determine how authority is exercised, how decisions are made, how stakeholders have their say and how decision-makers are held to account. Simply, governance is the process of providing strategic leadership by setting direction, making policy and strategy decisions, overseeing and monitoring organizational performance, and ensuring overall accountability. Traditionally, boards have been preoccupied with their fiduciary responsibilities, ensuring compliance with applicable laws, regulations and standards. Although they may have approved organizational strategies, increasingly, good governance also requires boards to participate with management in the development of the organization's strategic directions and goals. And now board members are being challenged to engage in generative thinking, wherein they frame issues in new light in search of tomorrow's most appropriate visions and modus operandi. Four key characteristics of good governance are:1 Accountability: the capacity of the corporate members (or the owners) and other

key stakeholders to call decision-makers to account for their actions. Effective accountability has two components: ‘answerability’ and ‘consequences’. The first

1 Adapted from Governing for Results by Mel D. Gill, 2005



is the requirement to respond periodically to questions concerning one’s official actions. The second is the need for the application of sanctions for breach of rules.

Transparency: timely access by the corporate members and other key stakeholders to low-cost, relevant, reliable information about finances, products or services and management of resources.

Predictability: refers to the conduct and actions of elected officials (Directors and officers) and appointed staff. Predictability results primarily from laws, regulations and role definitions that are clear, known in advance, fair, and uniformly and effectively enforced.

Participation (or engagement): the involvement of the corporate members and other key stakeholders in planning, decision processes and evaluation. This allows the Board to obtain reliable information, serves as a reality check and watchdog, spurs operational efficiency, and provides feedback by users of public services necessary for monitoring access to and quality of services.

These characteristics are essential for the development of a culture of openness, trust and stakeholder confidence that will inspire commitment to the Perley Rideau’s purpose, encourage excellence in governance and nurture a healthy balance between stability and innovation. Orientation training for new Board members should include a discussion of sustainable board governance.

1.2 ROLE OF THE BOARD IN GOVERNANCE2 As stated in Chapter 1 of Part 2, the Board’s job is to govern the affairs of the Corporation within the framework of relevant legislation and standards. The governance task may be seen as:

Ensuring compliance with all legal requirements; Strategic planning including the establishment of the vision, mission and core

values of the Perley Rideau; Monitoring the Perley Rideau’s quality of performance, not just in the delivery of

care services but also organizational performance in areas such as financial performance and external relations and the Board’s own performance;

Providing sound stewardship of all Perley Rideau resources including financial, human resources, plant and equipment and information technology;

Oversight of management; Identification and analysis of significant risks threatening the fulfillment of the

Perley Rideau’s vision, mission and its strategic objectives; Accountability to stakeholders, overseeing the maintenance of mutually beneficial

relations with them; and

2 Adapted from OHA Guide to Good Governance p. 13.



Maintaining effective structures, relationships and procedures for the continuing effective governance of the Perley Rideau.

1.3 STEWARDSHIP3

The term Stewardship is frequently associated with governance. Stewardship implies trust on behalf of the owners or stakeholders. Not only does stewardship require diligence and care in overseeing compliance with the letter of governing legislation and regulations, but also with their intent. Because many not-for-profit corporations receive public funding and/or special tax status, the public often has a legitimate interest in how they operate. Concerns may arise from ineffective or inappropriate use of public funds, unfair competition with the private sector, etc. Boards and directors need to be mindful that such actions give their corporation a public face that undermines its purpose and value system. Essential to earning and maintaining public trust is a corporate commitment to transparency. While openness cannot resolve underlying corporate problems, lack of disclosure certainly can magnify the harm to the corporation. Sustainability of the Perley Rideau requires public support from many quarters. The Corporation’s long-term health requires careful stewardship in all its activities. To this end, Directors must always comply with the intent of the law (even when the letter of the law may be unclear), acting in accordance with best governance practices, and being mindful of how a particular action or decision may be seen by the public. Such “stewardship” is essential if the Perley Rideau is to meet the public’s growing expectations for integrity, accountability and transparency by non-for-profit health care service providers.

1.4 THE BOARD AND MANAGEMENT

The Board's governance role is also described in terms of what it is not – the Board is not responsible for day-to-day management. Basically, the Board governs and management manages. The Board's role is to see that the Perley Rideau is well managed, but it is not the role of the Board to manage the organization. As described in Part 3 – Executive Authority, day-to-day management is delegated by the Board to the CEO. The Board exercises oversight of management. Accordingly, the Board's role with respect to each of the areas identified above is a governance role and not a management role. The relationship between the Board and management is fundamental to the quality of governance. Understanding the distinction between governance and management can

3 This section is adapted from "Primer for Directors of Not-For Profit Corporations", Industry Canada 2002, p. xi.



be challenging for any board. When boards do indulge in activities that are more appropriately or even solely within the purview of management, the quality of governance is compromised. The board loses both its focus and the time it needs to spend on board business.

1.4.1 Differentiating Board and Management Roles

The following table aptly differentiates the respective roles of Boards and Management.4

Board's Roles Management's Roles Select, evaluate and support the CEO Run the organization in line with Board

direction Keep the Board educated and informed Seek the Board's counsel

Approve high level organizational goals and policies

Recommend goals and policies with necessary and sufficient supporting rationale

Make major decisions Frame decisions in the context of the mission and strategic vision, and bring the Board well documented recommendations

Implement decisions

Oversee management and organizational performance

Bring the Board timely information in concise, contextual and comparative formats

Communicate with candour and transparency

Act as external advocates and diplomats in public policy, fundraising, and stakeholder community relations.

Keep the Board informed, bring the Board recommendations, and mobilize directors to leverage their external connections to support the organization

1.4.2 Seven Guiding Principles5

Even when the mutual roles of the Board and management are understood, there often remains a grey area in the middle. Different situations demand different levels of Board involvement. Adverse results may call for closer Board oversight; e.g. continuing subpar performance, allegations of improprieties, etc. In such cases more

4 Adapted from Great Boards, the on-line governance newsletter by Barry S. Bader, Fall 2008, Vol. VIII, No. 3 at www.greatboards.org/newsletter 5 Adapted from Bader, op. cit.



detailed information than normal may be sought. Otherwise, governing boards function best when focused on higher level, future oriented matters of strategy and policy. Seven questions can help guide the Board and management find their appropriate roles for any matter of board oversight or decision-making. 1. Is it big? The bigger the impact of a decision, the more the Board ought to play a role in shaping and understanding the action and its possible consequences. In other words, is the issue of strategic importance; e.g. an organizational decision impacting roughly ten percent of revenues or activities. Planning on how to implement the decision is management's responsibility. 2. Is it about the future? The Board's focus should be on the organization's long-term vision, its five-year financial plan and its master facility plan. The Board should rely on management to develop the details of the strategic plan. The approved strategic plan should focus on such aspects as quality, growth, finances, and people with measurable goals and indicators for each. If the strategic plan has more than five or six strategic areas and more than 20 strategic initiatives, the Board is getting at too low a level, i.e. management's operating plan. 3. Is it core to the mission? The Board is the guardian of the mission. The Board must examine strategic and financial decisions in the context of its mission. Management should bring the Board well documented analyses and recommendations to help Directors strike the right balance when mission and financial realities come into conflict. 4. Is a high-level policy needed to resolve a situation? Long-term care homes require hundreds of operating policies governing various aspects of clinical care, finance, personnel, etc. These are not Board matters. However, some issues arising from day-to-day activities may indicate a systemic issue warranting enunciation or amendment of a Board policy. Policies requiring Board approval should have a major impact on the organization, require compliance with laws or regulations, or affect the responsibilities and conduct of the Board or management. 5. Is a red flag flying? Boards should routinely review organizational performance summaries (i.e. dashboards, etc.). But when should they get into details arising from questions? Red flag issues may first be noticed in monitoring trends; (one rule of thumb states that a statistically significant over- or under-performance on a strategic, quality or financial indicator over three reporting periods constitutes a trend). The Board should be alerted by sentinel events such as reports of illegal activity or sudden dramatic underperformance. Other red flags may arise in auditors' reports, accreditation survey results, etc. To avoid slipping from governance into management, the Board must ascertain whether management recognizes the scope and has the capability and plans to improve the situation. Follow up is required to ensure that management is accountable for producing satisfactory results.



6. Is a watchdog watching? If the legislative and regulatory bodies or the media care, the Board should care. Hot button issues of the moment include lapses in resident or client care, medical errors, executive compensation, and publicly available quality reports. The Board should be engaged on such high profile issues, reviewing appropriate policies, overseeing performance, and ensuring that the organization is pro-active in its communications. 7. Does the CEO want or need the Board's support? If the CEO asks for Board advice or intervention, Directors should respond. When the CEO is facing particularly tough decisions such as labour strife, contract negotiations, terminations of personnel or contracts, etc., the CEO must know that the Board will stand firm. The CEO may seek a Board's support in challenging management to improve organizational performance, seeking more from its leaders. Or the CEO may ask for help from particular Directors with connections to key legislators, community stakeholders, etc. When the CEO calls, good Boards respond.

1.5 GOVERNANCE STANDARDS In response to the growing demand for excellence in health care delivery in Canada, Accreditation Canada, the body which conducts accreditation surveys for health service providers in Canada (including the Perley Rideau), has established a set of standards for sustainable governance6. The standards are grouped into four sections based on the following functions: Functioning as an effective governing body: Addresses the internal

development of the governing body, including composition, structure, and roles and responsibilities including the division of responsibility with organization leaders.

Developing a clear direction for the organization: Addresses the process for defining the organization’s mission and long-term vision, including broad organizational goals and values.

Supporting the organization to achieve its mandate: Addresses the governing body’s role in the processes that support the organization’s achievement of its strategic goals and objectives. It includes the recruitment and evaluation of the Chief Executive Officer (CEO), relationships with the CEO and the organization’s other leaders, and resource allocation.

Being accountable and achieving sustainable results: Addresses accountability (including stakeholder and community relations) and organizational performance (including quality improvement and risk management.

Accreditation Canada's standards for sustainable governance are summarized at Appendix A. These standards provide a comprehensive perspective as to the types of

6 Accreditation Canada Governance Standards - 2017



things generally considered to be the basis of good governance in Canada's health care sector today. One of these standards is that the Board must have a defined and formal process for decision making. The Board has adopted a simple decision framework that proposes the key questions/criteria that Board members should address before taking a decision. The Board decision framework is as follows:

1.6 CONDUCTING A GOVERNANCE AUDIT

The Board is responsible for its own governance. The Board must ensure that the structures and processes to facilitate governance are effective. This includes such aspects as: Board recruitment, training, evaluation and succession planning; Board structures and processes including position descriptions for officers, Board and Committee Chairs and Board members; terms of reference and reporting; education; and evaluation processes. Governance audits permit the Board to assess the degree to which the Board is able to discharge its fiduciary and strategic duties in a manner that ensures accountability to stakeholders and that the organization's mission and strategic goals and objectives are achieved. Are the processes and elements that the Board has adopted effective in

PERLEY RIDEAU BOARD OF DIRECTORS’ DECISION MAKING FRAMEWORK

DECISION SOUGHT

BACKGROUND TO THE ISSUE

KEY DECISION INFLUENCES OR CONSIDERATIONS 1. Strategic Fit

- Alignment with mission, vision, and strategic plan; and - Alignment with ministry and other governing body regulations, legislation and priorities.

2. Client Implications (quality and safety) 3. Stakeholder and Partner Impacts 4. Values and Ethics Considerations

- Equity, efficiency, client focused innovation, community engagement, transparency, consistency.

5. Risk Considerations 6. Operational Considerations

- Financial, Human Resources and others.

RECOMMENDED BOARD FOLLOW-UP STRATEGY 1. Key Measures for Monitoring 2. Evaluation Process 3. Role of Board and Management

(Board approved: April 3, 2014)



supporting Board performance and are they within the range of best practices for similarly situated organizations? A governance audit can be broad or limited in scope. When a Board evaluates its meeting effectiveness at the end of a Board meeting it is conducting a limited audit. Annual Board performance evaluations are another form of governance audit. A full audit would involve looking at every aspect of governance. Accreditation Canada’s quadrennial accreditation surveys constitute a major form of governance audit. The Board might consider conducting a comprehensive Governance Audit one year prior to an Accreditation Canada governance survey. The process for conducting a governance audit may include the following: Determining the scope of audit process that will be undertaken; Conducting an inventory of governance processes and practices. During this

information gathering phase, include an examination of governance documents, Board policies and decisions, and surveys of Board members;

Evaluating current governance practices against both legal and Perley Rideau policy requirements, as well as against best practices in similarly situated health care corporations;

Considering whether the documentation for governance processes reflect actual processes;

Assessing areas where change may be appropriate; Considering whether there are any significant gaps in the Board's governance

processes; and Making any recommendations for change deemed necessary. In addition to Appendix A: Accreditation Canada’s Standards for Sustainable Governance, two other appendices follow that should aid the Board and the Governance Committee in auditing the effectiveness of the Board’s governance: Appendix B: Governance Review Checklist (From Ontario Hospital Association’s Guide for Good Governance) and Appendix C: The Effective Not-for-Profit Board (Notes from Deloitte, 2009).

1.7 GOVERNANCE AND PLANNING COMMITTEE

To assist the Board in the fulfillment of its governance responsibilities, it has a standing committee to advise on governance and strategic planning matters. This Committee oversees the development of the Board, its conduct and its performance. As well, this Committee advises the Board on ethics policy and corporate values, and oversees the strategic planning and strategic management processes. Its terms of reference are in Appendix B to Chapter 3 of Part 2 of this Volume.

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Appendix A to Chapter 1 of Part 4

ACCREDITATION CANADA’S STANDARDS FOR

SUSTAINABLE GOVERNANCE7 FUNCTIONING AS AN EFFECTIVE GOVERNING BODY 1.0 The roles, responsibilities, and legal obligations of the governing body are defined

and followed.

1.1 The roles, responsibilities, and legal obligations of the governing body are defined and regularly reviewed.

1.2 There is written documentation that identifies the governing body’s roles and

responsibilities, as well as how those roles and responsibilities are carried out. 1.3 The governing body approves, adopts, and follows the ethics framework used

by the organization. 1.4 The governing body adopts a code of ethical conduct for its members. 1.5 There is a process to develop the governing body’s by‐laws and policies and

update them regularly. 1.6 The governing body’s by‐laws and policies are consistent with its mandate,

roles, responsibilities, accountabilities, and the organization’s ethics framework.

2.0 The governing body has the appropriate membership to fulfill its role.

2.1 The mix of background, experience and competencies needed in the governing body’s membership is identified.

2.2 There are established mechanisms for the governing body to hear from and

incorporate the voice and opinion of clients and families. 2.3 The governing body includes clients as members, where possible. 2.4 There is a documented process that is followed to elect or appoint the chair of

the governing body.

7 Extracted from Accreditation Canada Governance Standards – 2017



2.5 The roles and responsibilities of the chair are described in a position profile,

terms of reference, or by‐laws. 2.6 There are written criteria and a defined process for recruiting and selecting

new members of the governing body. 2.7 New members of the governing body receive an orientation before attending

their first meeting. 2.8 Each member of the governing body signs a statement acknowledging his or

her role and responsibilities, including expectations of the position and legal duties.

2.9 Members of the governing body receive ongoing education to help them fulfill

their individual roles and responsibilities and those of the governing body as a whole.

2.10 The governing body’s membership policies and/or by‐laws address term

lengths and limits, attendance requirements, and compensation. 2.11 The governing body’s renewal cycle supports the addition of new members

while maintaining a balance of experienced members to support the continuity of corporate memory and decision‐making.

3.0 There is a defined and formal process for decision making.

3.1 The ethics framework and evidence‐informed criteria are used by the

governing body to guide decision making. 3.2 Areas where decision making is shared with government, funding authorities,

and other health organizations are identified. 3.3 The information required to support decision making is available and

accessible to the governing body. 3.4 The governing body has processes in place to oversee the functions of audit

and finance, quality and safety, and talent management. 3.5 Required information and documentation is received in enough time to

prepare for meetings and decision making. 3.6 The governing body reviews the type of information it receives to assess its

appropriateness in helping the governing body to carry out its role.



DEVELOPING A CLEAR DIRECTION FOR THE ORGANIZATION

4.0 The governing body works with the organization’s leaders to develop the

organization’s mission statement.

4.1 The governing body works in collaboration with the organization’s leaders to develop the organization’s mission statement.

4.2 When developing or updating the mission statement, input is sought from

team members and external stakeholders, including clients, families and partners.

4.3 Government or the organization’s shareholders are regularly consulted to

confirm the appropriateness of the organization’s mandate and core services and to develop a common understanding about performance expectations.

4.4 The organization’s mission statement is regularly reviewed and revised as

necessary to reflect changes in the environment, scope of services, or mandate.

5.0 The governing body defines and models the organizational values.

5.1 The governing body works with the organization’s leaders to define or update the organization’s values statement.

5.2 The governing body collaborates with the organization’s leaders to seek input

from team members, clients, and families to define or update the organization’s values statement.

5.3 The governing body provides oversight of the organization’s efforts to build

meaningful partnerships with clients and families. 5.4 The governing body monitors and evaluates the organization’s initiatives to

build and maintain a culture of client‐ and family‐centred care. 5.5 The governing body has a formal process to understand, identify, declare, and

resolve conflicts of interest.

6.0 The governing body oversees a strategic planning process to develop the organization’s vision and set the strategic plan, goals, and objectives.



6.1 The governing body oversees the strategic planning process and provides guidance to the organization’s leaders as they develop and update the organization’s vision and strategic plan.

6.2 The governing body, in consultation with the organization’s leaders, identifies

timeframes and responsibility for achieving the strategic goals and objectives. 6.3 The governing body works with the organization’s leaders to conduct an

ongoing environmental scan to identify changes and new challenges, and ensures that the strategic plan, goals, and objectives are adjusted accordingly.

SUPPORTING THE ORGANIZATION TO ACHIEVE ITS MANDATE 7.0 The governing body recruits, selects, supports, and evaluates the CEO and ensures

an organizational talent management plan is in place. 7.1 The governing body oversees the recruitment and selection of the CEO. 7.2 The governing body follows a policy on CEO compensation. 7.3 The governing body develops and updates the position profile for the CEO. 7.4 In partnership with the CEO, the governing body sets performance objectives

for the CEO and reviews them annually. 7.5 The governing body supports and commits resources to the ongoing

professional development of the CEO. 7.6 The governing body has a mechanism to receive updates or reports from the

CEO. 7.7 The governing body, with the input of the organization’s leaders, evaluates the

CEO’s performance and achievements annually. 7.8 The governing body has a succession plan for the CEO. 7.9 The governing body oversees the development of the organization’s talent

management plan. 8.0 Note: All standards under item 8 refer to the process for granting and renewing

privileges to health care providers. This standard is not applicable to long‐term care.



9.0 The governing body has an effective system of financial planning and control which supports achievement of the strategic goals and objectives.

9.1 The governing body approves the organization’s capital and operating budgets. 9.2 The governing body ensures the integrity of the organization’s financial

statements, internal controls, and financial information systems. 9.3 The governing body reviews the organization’s financial performance in the

context of the strategic plan and key performance areas such as utilization, risk, and safety.

9.4 The governing body reviews and approves the organization’s capital

investments and major equipment purchases. 9.5 The governing body oversees the organization’s resource allocation decisions

as part of its regular planning cycle. 9.6 When reviewing and approving resource allocation decisions, the governing

body assesses the risks and benefits to the organization. 9.7 When approving resource allocation decisions, the governing body evaluates

the impact of the decision on quality, safety and client experience. 9.8 The governing body anticipates the organization’s financial needs and

potential risks, and develops contingency plans to address them. 9.9 The governing body addresses recommendations in financial reports and from

the CEO and the organization’s leaders.

10.0 The governing body fosters and supports a culture of client safety throughout the organization. 10.1 The governing body adopts client safety as a written strategic priority for the

organization. 10.2 The governing body monitors organization‐level measures of client safety. 10.3 The governing body addresses recommendations made in the organization’s

quarterly client safety reports. 10.4 The governing body regularly reviews the frequency and severity of safety

incidents and uses this information to understand trends, client and team safety issues in the organization, and opportunities for improvement.



10.5 The governing body regularly hears about quality and safety incidents from the

clients and families that experience them.

BEING ACCOUNTABLE AND ACHIEVING SUSTAINABLE RESULTS

11.0 The governing body strengthens relationships with stakeholders and the community.

11.1 The governing body works with the CEO to identify stakeholders and learn

about their characteristics, priorities, interests, activities, and potential to influence the organization.

11.2 In consultation with the CEO, the governing body anticipates, assesses, and

responds to stakeholders’ interests and needs. 11.3 The governing body works with the CEO to establish, implement, and evaluate

a communication plan for the organization. 11.4 The communication plan includes strategies to communicate key messages to

clients and families, team members, stakeholders, and the community. 11.5 The governing body promotes the organization and demonstrates the value of

its services to stakeholders and the community. 11.6 The governing body regularly consults with and encourages feedback from

stakeholders and the community about the organization and its services. 11.7 The governing body, in collaboration with the organization’s leaders, share

reports about the organization’s performance and quality of services with teams, clients, families, the community served, and other stakeholders.

12.0 The governing body works with the CEO to reduce risks to the organization and

promote ongoing quality improvement.

12.1 Required Organizational Practice: The governing body demonstrates accountability for the quality of care provided by the organization.



Test(s) for Compliance: 12.1.1 The governing body is knowledgeable about quality and safety

principles, by recruiting members with this knowledge or providing access to education. (Minor)

12.1.2 Quality is a standing agenda item at all regular meetings of the governing body. (Major)

12.1.3 The key system‐level indicators that will be used to monitor the quality performance of the organization are identified. (Major)

12.1.4 At least quarterly, the quality performance of the organization is monitored and evaluated against agreed‐upon goals and objectives. (Major)

12.1.5 Information about the quality performance of the organization is used to make resource allocation decisions and set priorities and expectations. (Minor)

12.1.6 As part of their performance evaluation, senior leaders who report to the governing body (e.g. the CEO, Executive Director, Chief of Staff) are held accountable for the quality performance of the organization. (Major)

12.2 The governing body works with the CEO and the organization’s leaders to

develop an integrated quality improvement plan. 12.3 The governing body ensures that an integrated risk management approach and

contingency plans are in place. 12.4 The governing body receives summary reports of client and family complaints

received by the organization. 12.5 The governing body monitors and provides input into the organization’s

strategies to address client flow and variations in service demands. 12.6 The governing body promotes learning from results, making decisions that are

informed by research and evidence, and ongoing quality improvement for the organization and the governing body.

12.7 The governing body demonstrates a commitment to recognizing team

members for their quality improvement work.

13.0 The governing body regularly evaluates the performance of individual board members and its performance as a whole. 13.1 The governing body publicly discloses information about its governance

processes, decision‐making, and performance.



13.2 The governing body’s activities and decisions are recorded and archived. 13.3 The governing body shares the records of its activities and decisions with the

organization. 13.4 The governing body follows a process to regularly evaluate its performance

and effectiveness. 13.5 The governing body conducts or participates in an assessment of its structure,

including size and committee structure. 13.6 The governing body regularly evaluates the performance of the board chair

based on established criteria. 13.7 The governing body regularly reviews the contribution of individual members

and provides feedback to them. 13.8 Accreditation Canada Required Instrument: The governing body regularly

assesses its own functioning using the Governance Functioning Tool. Instrument Information:

13.8.1 The governing body monitors its team functioning by administering the Governance Functioning Tool at least once every accreditation cycle.

13.8.2 The governing body has taken action based on its most recent Governance Functioning Tool results.

13.9 The governing body prepares an annual report of its achievements. 13.10 The governing body identifies and addresses opportunities for improvement in

how it functions.

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Appendix B

to Chapter 1 of Part 4

GOVERNANCE REVIEW CHECKLIST8

Checklist of Governance Practices

Status of Governance Practices & Recommendations

1. Legal Structure

a. Review of Letters Patent, Supplementary Letters Patent, Transfer Agreement? b. Date of most recent Bylaw Review and Update? c. Date of most recent Service Accountability Agreement? d. Date of most recent Governance Review?

2. Role of Corporation and Accountabilities

a. Role of the corporation (provide copies of: objects/purpose, mission, vision and values, strategic directions, etc.)?

b. Date of last strategic plan. Date of next review. c. Identify the Corporation’s accountabilities and key relationships. Is there a

formal statement of corporate accountability? Date of last review?

3. The Board’s Governance Role

I. Define the role of the Board

a. Board exercises a governance role in the following areas: strategic planning, financial oversight, risk/quality oversight, CEO and staff supervision, succession planning, communication and governance. Has the Board expressly adopted a statement of the Board’s role? Date of last review?

b. Is there an annual Board work plan?

II. Provide an outline of how the Board performs its responsibilities for the following areas of Board performance:

a. Strategic planning – ensuring a strategic plan is developed with Board participation and ultimate Board approval, ensure annual review by management and Board?

b. Oversight of management (CEO) – develop and approve CEO job description; select the CEO; review and approve the CEO’s annual performance goals; ensure succession plans are in place for CEO and senior management; exercise oversight of the CEO’s supervision of senior management as part of CEO’s annual review?

8 Based on Guide to Good Governance, by Ontario Hospital Association, p.21



c. Quality and risk identification and management – ensure quality standards and

indicators are established and approved by the Board; ensure Board understands its role in relation to risk; ensure processes are in place for identifying risks; and that plans are developed and implemented to monitor and manage risks?

d. Financial oversight – stewardship of financial resources including setting policies for financial planning; approving annual budget; monitoring performance; approving investment policies; and approving audited financial statements?

e. Governance – the Board is responsible for quality of its own governance; the Board establishes and periodically assesses policies regarding Board conduct and processes; the Board reviews its governance structures (board size/composition, committee mandates and composition, officers, meeting effectiveness, etc.) at periodic intervals; the Board is responsible for its own succession and ongoing quality (education) and to monitor Board and individual director’s effectiveness through annual evaluations?

f. Communications and Accountability – ensure organization appropriately communicates with its stakeholders in a manner consistent with accountability to stakeholders?

4. Duties, Obligations and Expectations of Individual Directors

a. Fiduciary obligations to adhere to and observe the standard of care expected of a director and to obey the “Rules of Fiduciary Conduct”. The standard of care is to act honestly and in good faith and in the best interests of the Perley Rideau and to apply the skill and judgment that might reasonably be expected of a person with the same level of skill (special expertise must be applied). Is there a formal policy with respect to the Directors’ duties? How are Directors made aware of their duties and obligations?

b. Rules of fiduciary conduct Avoid conflict of interest? Corporate obedience – solidarity, board speaks with one voice? Confidentiality? Loyalty – act in interest of Perley Rideau as a whole and not any one group

or representative body? Board Code of Conduct describing the rules of fiduciary conduct?

c. Attendance - Describe expectations regarding the level of attendance and participation at Board and committee meetings. How are these expectations communicated?

d. Self evaluation or peer review - Describe participation in Board and individual Director evaluation?

5. Board Governance Policies

a. Formal governance policy manual is available?

b. Date of last review?

c. Process for updating?



6. Board Composition and Recruitment

I. Board Size and Composition

a. Identify number of elected/appointed/ex officio directors. List ex officio Directors by office?

II. Board Quality a. Is there a process to identify skills required of Board members? b. Is a Board profile or skills matrix of the current Board maintained? c. How are prospective nominees identified? Is a roster of eligible candidates

maintained?

d. How are prospective Board candidates advised with respect to the role and expectations of Directors?

e. How are prospective candidates evaluated? f. Who makes the recommendation of approved candidates? g. How are elections held at Annual Meetings?

III. Term of Offices a. Board term (initial, renewal and maximum terms)? b. Committee chair terms (initial, renewal and maximum terms? c. Other terms (initial, renewal, and maximum terms)? Identify officers

7. Officers

a. There is a clear process to select officers and committee chairs? b. Are position descriptions prepared and periodically reviewed?

8. Board Committees

a. Do committees have written mandates? b. Are committee mandates reviewed periodically? c. How are committees established? Committees are established pursuant to

governance principles? (Committees do Board work, not management work?) How are committee reports and recommendations handled by the Board?

d. Is the Audit committee comprised of independent Directors? e. Is there an Executive Committee and how does it report to the Board? Describe

decision making role for the Executive Committee?

9. Board orientation, Education and Evaluation

a. Is Board orientation mandatory? How is orientation conducted? b. Is there a written manual for new Board members? c. Is there a clear process for Directors to participate in external education

programs?

d. How is Board education conducted? e. What is the frequency of continuing education for Directors? f. Is an annual Board retreat held? Date of last retreat, attendance and agenda? g. Is there an annual evaluation of the performance of individual Directors and the

Board as a whole? Provide a copy of the evaluation tool and describe process for providing feedback and acting on results?



10. Board Governance Policies

a. Provide sample Board agendas. Is Board work aligned with the annual Board goals and work plan?

b. Are decision items separated from information items? c. Is specific time allocated for agenda items and is time allowed adhered to? d. What is the process to bring forward Board committee’s recommendations and

reports?

e. Are meetings regularly evaluated? Using what evaluation tool? f. Are meetings open and is there a proper use of in camera sessions? g. Does the Board meet without management from time to time? h. Is there a clear policy that allows the Board to obtain independent advice (legal,

financial or other?)



Appendix C to Chapter 1 of Part 4

THE EFFECTIVE NOT-FOR-PROFIT BOARD9

Mandate and Responsibilities

Does the Board periodically study the documents that describe the NPO’s role and purpose? Is that role still appropriate under the current and anticipated environment and orientation of the NPO?

Is the NPO able to effectively fulfill its role given constraints of its current resources (funds, staff, volunteers, etc.)?

Does the Board understand the key elements essential to the NPO’s success (e.g. reputation in the community, status as a charitable organization, active support of volunteers, key employees, funding, the continuing need for its services)?

Has the Board ensured that management has identified the potential risks that could undermine each of these key elements? Has management put processes in place to protect against each risk, particularly, the most serious and/or the most likely to occur?

Does the Board understand the skills and expertise required to manage the NPO? Is the Board actively involved in approving objectives for the management team and in

monitoring management’s performance? Has the Board identified the NPO’s various stakeholders, the expectations each

stakeholder group has for the NPO, and the appropriate methods to communicate to and from each?

Who serves as the primary spokesperson for the organization on a regular basis? In the event of a crisis?

What internal controls exist over the use of resources, approving expenditures and investing funds? Is the Board responsible for reviewing and approving budgets? What decisions need Board approval?

What controls are in place to ensure the integrity of management information systems? Do the current information systems supply the appropriate information to effectively manage the organization?

How does the Board maintain objective oversight of management tasks undertaken by Board members? (For example, if a Board member serves as the NPO’s treasurer, how does the Board oversee the treasury function?)

Has the Board articulated its responsibilities in a formal mandate and published its mandate so it can be read and understood by management and the NPO’s stakeholders?

Organization and Resources Does the Board’s mandate describe the structure (number and qualifications of

members, Board leadership, responsibilities, etc.,) for each of its committees? Does the Board periodically review this documentation for accuracy and relevance?

9 From Deloitte Notes: 7 Feb 09



Do Board members have the appropriate knowledge, skills and experience and objectivity?

Who chairs the Board and how is this person selected? Is the Board Chair independent of management? Are the Board Chair’s responsibilities clearly defined? What is the Board Chair’s term of office and what processes ensure reasonable continuity between Chairs?

Is the Board required to select particular constituencies (e.g. must it have representatives form each region of the country?) Does this requirement affect the Board’s costs, the members selected to sit on committees, or members’ ability to attend all Board meetings?

How long does a person normally serve on the Board? If there is a high turnover of members from year to year, what processes facilitate the continuity of policies and actions? Is there a succession plan for the Board?

How are new Board members selected? Is there a nominating committee? Does the volunteer nature of Board membership affect its ability to attract and retain Board members, particularly in an increasingly litigious environment?

What committees does the Board have, and who serves on each of them? Are each of the committee’s roles and duties clearly understood and periodically reviewed?

Does the NPO have an audit and, if so, is there an audit committee? If the NPO has a combined finance/audit committee, what steps are taken to see that this committee devotes sufficient time to its audit responsibilities?

Should there be a governance committee or should this responsibility be assigned to the nominating or other committee?

Does the Board have an orientation program for new members to enable them to more quickly get up to speed and be able to participate effectively on the Board? Is there a continuing education program?

Information and Processes Has the Board determined the information it needs in order to fulfill its responsibilities?

Does this information permit the Board to assess the NPO’s performance on key success factors, other than just financial ones? Has the Board conveyed to management its expectations regarding its information requirements?

Does the organization have a mechanism to obtain input from stakeholders? How much of this information is provided to the Board?

Does the Board receive information that enables it to assess the integrity of the systems of internal control? Does it have the opportunity to discuss legal and other compliance issues with management (such as assurances about employee wages and required source withholdings?)

How are Board meetings structured? Has the Board translated its mandate into an effective work plan? Is sufficient time provided for an appropriate discussion of important topics? Who sets the agendas? Are meetings too long, too short or too infrequent? Do all Board members have the opportunity to participate fully at Board meetings? How well are meetings attended? If a Board member is absent from a meeting, can he/she record dissent with any decision?



Does the Board maintain formal minutes of its meetings with an adequate documentation of decisions, and the reasons for them? Does the Board have access to this material for past years?

Are resolutions and policies of a similar nature consolidated and updated on a regular basis?

Monitoring and Accountability How does the Board currently assess its own performance, and that of its committees

and individual Board members? Is it possible to assess the performance of Board members who serve as volunteers and

are not remunerated for Board service? Which individuals or groups are involved in the assessment process? Is it documented? How does the Board deal with the issues raised in its assessments in order to foster

continuous improvement? Are Directors briefed periodically on their potential liabilities? Has the Board taken

out Directors and officers liability insurance? Does the Board help determine the content and distribution of the NPO’s financial

statements and annual report? What information must be disclosed to regulatory authorities? To funding agencies? To other stakeholders?

Organizational Culture What is the Board’s role and responsibility for setting the organization’s values and its

philosophies? Does the NPO have a code of conduct that governs the behaviour of Board members,

management, staff and volunteers? Is the code understood and reflected in the NPO’s policies? Is there a policy regarding whistle blowing?

Is the Board satisfied that stakeholders concerns have been adequately addressed and that their interests have been incorporated in the NPO’s code of conduct and value statements?

How should the Board link its boardroom culture with the culture of the organization? Do the Board’s activities reflect the culture and code of conduct of the NPO as a whole?

Does the organization encourage an environment in which information is exchanged freely within the NPO, while respecting confidentiality? Does an atmosphere exist in which people feel they can ask questions openly?

Are Board members able to participate as equals and to communicate openly at Board meetings? Are they encouraged to challenge management proposals? Are dissenting views given consideration at Board meetings?

Do Board and management set an example in exhibiting their commitment to the organization and its success?


VOL III – GOVERNANCE / Part 4 – Stewardship: Guidance for Good Governance / Ch 2 – Strategic Planning and Management (Board Approved 06Feb2014; Rev. 07Sept2017) Page 1 of 16


Chapter 2

STRATEGIC PLANNING AND MANAGEMENT1

This chapter provides guidance for the strategic planning process, including a differentiation between Board and management responsibilities in this process.

It also provides guidance for the review and assessment of progress in meeting the strategic directions and fulfillment of the vision.

2.1 GENERAL One of the most important responsibilities of the Board of Directors is to provide general guidance and direction for the Perley Rideau. Strategic planning is the comprehensive framework for planning, setting priorities, and making decisions. Strategic planning and review is a key component of effective risk management and effective organizational stewardship. Good planning results in better communication and a better understanding of how various parts of an organization work together to produce desired results. Strategic planning deals with questions such as: What do we do? For whom do we do it? How do we excel? The Strategic Plan, management’s annual operating plan, and the capital and operating budgets are vital components of the Perley Rideau’s strategic management processes. As such they each require the approval and continuing oversight of the Board of Directors to ensure the fulfillment of the broad directions laid out in the Strategic Plan. The Strategic Plan records the decisions the Board has made with respect to its strategy intentions. The plan includes broad strategic directions and the general goals for each, as well as the rationale, analyses and background information supporting those decisions. The full strategic planning process is completed every three to five years with a planning horizon that may stretch 10 to 15 years. The strategic planning process is iterative and collaborative involving management and staff, stakeholders, as well as Board members.

1This Chapter draws heavily from the Ontario Hospital Association’s “Guide to Good Governance”, Chapter 5.



2.1.1 Standards for Strategic Planning Accreditation Canada has established standards for sustainable governance. In the area of strategic planning for health service providers, standards are provided for “Developing a clear direction for the organization” (standards 4, 5 and 6). These are reproduced at Appendix A to Chapter 1.

2.2 STRATEGIC MANAGEMENT

The strategic plan describes how the Perley Rideau intends to move from where it is now towards its Vision in accordance with its Mission, Values and Tolerance for Risk. In so doing, it plans to use its strengths to take advantage of opportunities, to remedy its weaknesses, and to avoid or mitigate threats. From the Strategic Plan, which typically takes a longer term view, management develops shorter term operating plans for staff and budgets for the revenues and expenditures needed to move towards the Vision. Finally, the organization monitors its progress against targets and budgets and uses the lessons it learns from experience to enhance the next round of planning and budgeting. In contemporary management, this cycle of strategic thinking, analysis, and performance review is referred to as strategic management, implying a collaborative Board and management involvement. Strategy, strategic direction and strategic management are about the “big picture” and generally involve the following: The definition of success for the organization, including the basic framework of goals

and policies that guide the activities of the organization over the long term. The approach to be taken to be successful, including the assignment of resources and

the development of the requisite organizational competencies; The positioning of the organization in relation to others in the sector in terms of

whom it serves, and the programs and services to be offered. Although approval of the strategic and operating plans and the capital and operating budgets are key responsibilities of the Board of Directors, typically the Board delegates the detailed work to management and Committees. Nevertheless, the Directors should satisfy themselves that the planning and budgeting processes were properly organized, conducted and documented. A summary of Board and Management responsibilities is included in Appendix A to this Chapter.

2.2.1 Components of Strategic Management

The Board’s involvement in strategic management comprises three components:



Strategic Framework The first is setting the strategic framework for the Perley Rideau for the long term. The key elements of this framework include the mission, the vision and the corporate values2. Mission. Typically the mission is a short statement of the organization’s purpose:

what we do, for whom and why. The mission statement is generally broad and its fundamental content should remain relevant for a long time.

Values. The values statement is a collection of norms, principles and commitments that the Perley Rideau believes in and plans to live by. The corporate values are enduring, with changes being more about form than substance.

Vision. Whereas the mission statement describes the purpose of the Perley Rideau, its vision describes what the Corporation plans to accomplish or what it expects to become in the fullness of time.

Setting Medium Term Strategic Directions Consistent with the mission, vision and values, the Strategic Plan should provide a set of directions and initiatives to guide the investment of resources and effort for the next few (usually five) years. These directions may include: A goal or time-bound vision with more substantive objectives for the Perley Rideau

for the medium term; Strategic directions (objectives or themes) that build towards the long-term vision.

These may include changes to strategic positioning (e.g. who is to be served or what new services are to be offered);

Defining organizational capacity and characteristics needed to succeed; New initiatives envisaged for moving towards the new vision and strategic

positioning, and for improving the organization’s capacity and performance. The key is that these directions (themes, initiatives, objectives, etc.) involve achieving or doing something specific. They are usually measurable in that clear targets and indicators can be defined to demonstrate when the directions have been fulfilled and the intended results achieved. Approving Major Decisions Not everything important or strategic can be anticipated in the Strategic Plan. Thus, an essential element of strategic management includes the review, questioning, provision of advice to management, and ultimately the approval of unplanned major decisions facing the Perley Rideau. Some of these decisions may relate directly to the implementation of the strategic

framework and directions;

2 The Perley Rideau’s Vision and Mission are outlined in Volume II and its Ethics and Values in Part 1 of this Volume.



Other decisions required may emerge between planning cycles, some of which may necessitate amendment of the long term vision or mission statements;

In either case, the Board needs to maintain the strategic “big picture” to ensure that decisions and directions are in the best long-term interests of the Corporation.

2.3 STRATEGIC PLANNING

Strategic planning requires a disciplined, systematic process to define the purpose and direction of the Perley Rideau, recognizing the current and future state of the external and internal environment within which it operates. In the past the Perley Rideau has convened an ad hoc committee to lead the strategic planning process. These duties are now assigned to the Governance and Planning Committee. Terms of Reference for that Committee are in Appendix B to Chapter 3 of Part 2 of this Volume.

2.3.1 Timing How often and when should the Perley Rideau undertake such effort? Considerations relating to the timing of strategic planning include: Strategic planning across the whole organization requires a major investment of time

and effort for research, external consultation, analysis, and deliberation by both the Board and management over typically six to eight months;

A regular strategic planning process is an effective method for the Board to fulfill its strategic management role by: Reviewing (and if necessary rethinking) the Perley Rideau’s strategic framework

and directions; Annually conducting a strategic assessment of the Strategic Plan to provide any

relevant updates based on new information or events; Facilitating management’s work for the forthcoming operational planning and

budget cycle. Typically Perley Rideau strategic plans focus on the next five years. However, the

long-term vision and the environmental scan may look out 10 to 15 years. A new Strategic Plan may be undertaken any time at the Board’s direction. The need

is generally indicated by: Key assumptions of the current plan being overtaken by events; Externally dictated changes by government. (In such cases, regardless of the

normal strategic planning cycle, Board and management will need to focus on implementing the necessary change before a new look at the long term can be undertaken.)

2.3.2 Strategic Analysis

Effective strategic analysis may comprise many elements; a few key considerations and tools are briefly outlined below.



Situational Assessment and Environmental Scan The starting point for the strategic planning process is the existing Strategic Plan (mission, vision, values, directions, goals, etc.) as well as governmental requirements, such as changed legislation or regulations, service accountability agreements, etc. A situational assessment sets out the context for the planning from both an internal and an external perspective to include a review of the current situation, trends and forecasts of emerging trends. The external scan should consider such factors as:

o Health sector trends; o Funding trends; o Legislative changes and possibilities; o Demographics and population health indicators; o Alternative sources of seniors’ care; o Technology trends; etc.

The internal scan should consider such factors as:

o Recent performance indicators for care; o Financial condition and performance; o Asset and infrastructure condition; o Information technology capability and requirements; o Human capital (strengths and capacity); o Innovation and new programs; o Community and stakeholder relationships; etc.

A situational assessment using the four-box format of a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis is a useful tool for summarizing the circumstances facing the planners as revealed by the environmental scans.

Strategic Issues. From this type of global thinking, strategic issues begin to emerge. Such issues may relate to: Common themes emerging from the situational assessment and SWOT analysis; Significant gaps in operational performance between actual and targeted

performance, including comparisons to external benchmarks; Key success factors warranting greater attention for the fulfillment of the long term

vision. Strategic Directions. The formulation of propositions for broad strategic action follows logically from the identification of strategic issues warranting corporate action. These proposed strategic directions should set out broad areas for action and investment in terms of time, energy and dollars. The number of directions should be relatively few, providing a few focal points for operational planning by management. They should reflect the following:



An updated strategic framework (vision, mission and values statements); Each strategic direction should open doors to a number of action areas or initiatives

which will likely require extensive time to implement; Action should start within a year, but downstream benefits may accrue primarily in

the medium to long term; Wherever possible, specific targets should be set as a basis for measurement or

judging whether the objectives have been met. Validity of Assumptions. In formulating plausible strategic directions, the Board should challenge the validity of the implicit assumptions including such aspects as:

Government funding levels and donor contributions; Legislation and regulations affecting health care delivery; Project costs and timeframes; and Stakeholder and market response to the new initiative. Scenario Analysis. It would be impossible to anticipate and plan for every possible contingency. However, discussing the assumptions and the potential consequences and probability for each can strengthen the rigour of the planning process. By examining various scenarios of changing assumptions, the Board’s strategic directions are more likely to withstand the test of time. Scenario analysis involves asking such questions as: What other assumptions might be appropriate? How might things turn out under different assumptions? How probable are the different assumptions? What are the best and worst case scenarios? What strategies would most likely succeed? What alternative strategies might be suitable? Risk Assessment 3. Here, the Board’s role becomes more critical - striving to find a comfortable balance between taking advantage of opportunities and the Perley Rideau’s corporate strengths weighed against the inherent risks. The Board’s assessment of risks should take into account:

Any risk tolerance levels specifically approved by the Board; The Perley Rideau’s capacity for risk (including such considerations as the strength

of its finances, donor support, reputation and credibility, and the experience and competence of the staff to implement the associated change);

3 See Chapter 7 for a further discussion of Risk.



The spirit and attitudes of the organization and its stakeholders towards risk as well as the corporate values of the organization;

The validity of the assumptions. Implementation Timetable and Plan Although the Board’s focus is on setting appropriate strategic directions, the Strategic Plan needs to be linked to the implementation process. Typically strategic plans include management’s implementation plan which: Establishes a timetable for implementation; Defines milestones or descriptions of success for successive years that can be

evaluated; Assigns accountability for implementation; Defines risks more specifically; and Establishes the reporting requirements for monitoring by the Board.

2.3.3 Process Characteristics Undertaking a new Strategic Plan is a significant organizational undertaking. The many processes involved should be characterized by: Big Picture Focus. Wading through the reams of inevitable detail can obscure the

big picture. Participants in the strategic planning process frequently require reminding of the values, vision and mission, as well as the success measurements being sought.

Simplification. By breaking the situational assessment into major components along thematic or functional areas, the subsequent detailed operational planning can be simplified.

Broad Consultation. Strategic planning provides an opportunity to engage the Perley Rideau’s stakeholders. Broad consultation and diverse ideas enhance the quality of assessment in mission development and garnering community support. The Perley Rideau has used formal focus groups to assist in these consultations. (But broad consultations are time consuming; balance is essential to effectiveness.)

Open and Participative Process. As many channels of communication as practicable should be used to increase awareness, understanding and buy-in to the process and to the results. Surveys, focus groups, community consultations, email updates, newsletters, open houses and presentations all may have benefit.

2.3.4 Communicating the Strategic Plan

From a strictly governance point of view, the Strategic Plan provides the Board’s strategic direction to management. However, the Board’s role does not stop here. The Board must be prepared to participate in communicating the plan to the stakeholders who need to know the Perley Rideau’s strategic direction.



Management should develop a coherent communications plan for getting the message out. The plan should include those aspects of the communications that will require direct Board involvement, the targeted stakeholders, the timelines, and a selection of appropriate communication vehicles (e.g. press conference, summary pamphlets, speaking engagements). The key point is that the highlights of the Perley Rideau’s Strategic Plan and progress in fulfilling its strategic directions need to be effectively communicated, demonstrating its accountability to the community it serves and its stakeholders.

2.3.5 Strategic Reviews and Assessments

Once a Strategic Plan is in place, it is a living document requiring regular reviews and updates. Management should keep the Board up-to-date on the attainment of significant milestones (or challenges) in fulfilling the achievement of the strategic directions or initiatives. Progress reports should include quantitative indicators where available. As part of its annual work cycle, the Board should comprehensively review the Strategic Plan, culminating in the preparation of a formal strategic assessment. During this process, the Board evaluates such considerations as: Significant changes to the internal or external environment which would undermine

the validity of the assumptions implicit in the Strategic Plan (the same environmental scan items listed section 2.3.2 above pertain);

Reported progress (or lack thereof) in fulfilling the strategic goals and objectives; New initiatives or investments; and The continuing suitability of the current strategic directions.

This annual comprehensive review of the Strategic Plan should be conducted prior to management’s start of its annual operational planning and budgeting cycle. At the conclusion of this review, the Board may identify major actions that are required, possibly making changes to its strategic directions, strategies or priorities. In doing so, it must consider the implications on the mission, values and vision of the organization. Further, the Board must clearly communicate any changes or implications deriving from its strategic assessment to the organization, usually via a formal presentation at the Annual Meeting of the Corporation. Even where the Strategic Plan does not change significantly, the process of revisiting it can help to re-energize, refocus and renew the organization.



2.3.6 Annual Operating Plan4

The CEO and management develop annual operating plans and budgets based on the strategic directions contained in the Strategic Plan. These become the focus of work throughout the organization over the next twelve-month period. They will contain estimates of service demand for the year as well as objectives for improvement in key areas of corporate activity. The annual operating plan will be the basis of its yearly budget containing revenues and expenditure forecasts related to planned programs and/or volumes of service. This plan will contain more specific objectives than contained in the Strategic Plan, such as: Expected results for each objective; The time period during which those results will be sought; and Criteria for measuring the achievement of those results. The annual operating plan, together with service statistics and budget forecasts are presented to the Board for review, amendment and approval.

2.3.7 Review of Strategic Planning Processes

In the year prior to commencing a new strategic planning cycle, it would behoove the Board to undertake a review of its strategic planning and management processes. A checklist for this purpose is attached at Appendix B to this Chapter.

**************

4 See Chapter 4 - Financial Stewardship for a further discussion on the Annual Operating Plan.



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PLANNING CYCLE AND

RELATED BOARD AND MANAGEMENT RESPONSIBILITIES The planning cycle should include as a minimum the following phases:

Establishing the planning timetable and process; Agreeing the strategic framework (mission, vision and values); Conducting external and internal environmental scans; Formulation of strategic directions; Risk analysis, including:

o Defining and testing assumptions; o Scenario testing; o Sensitivity analysis; and o Risk mitigation measures;

Development of strategies and alternative strategies; Establishing key performance indicators, including financial measures; Development of the Implementation Plan including specific performance targets; Approval and communication of the Strategic Plan; Regular progress reviews re implementation of the Plan; Annual strategic assessment of the continuing suitability of the Strategic Plan; Revision to the Plan, as necessary.

Board Responsibilities In fulfilling its responsibilities for strategic planning and management, the Board:

Provides initial approval of the strategic planning process to be followed; Participates in workshop style dialogues with staff at key points in the process, especially

with respect to the formation of strategic directions; Reviews the highlights of findings of the facts and analyses at regular Board meetings; Receives the final draft of the Strategic Plan in sufficient time to meaningfully challenge

and recommend changes to the plan; Approves the final Strategic Plan; Considers and approves the CEO’s Implementation Plan for fulfilling the strategic

objectives of the Plan; Contributes (as necessary) to the communication of the plan to stakeholders; Reviews regular progress reports on the fulfillment of the approved strategic directions; Approves changes to the mission, values, vision and strategic directions as necessary; and Presents an annual Strategic Assessment of the suitability of the strategic plan at the

Annual Meeting.



Management’s Responsibilities The CEO is responsible to the Board for:

Defining the process to be followed for the strategic planning cycle; The conduct of the internal and external environmental scans; Keeping the Board apprised of key developments at all stages of the Plan’s development; Preparing the Strategic Plan, including the more detailed Implementation Plan, for Board

approval; Communication of the Strategic Plan to stakeholders; Preparation of the annual Operating Plan and Budget for Board approval; Apprising the Board on a regular basis of progress on the fulfillment of key milestones or

events; and Supporting the Board in the conduct of its annual Strategic Assessment of the continuing

suitability of the current Strategic Plan.



Appendix B to Chapter 2 of Part 4

STRATEGIC PLANNING AND MANAGEMENT

REVIEW CHECKLIST5

POLICY AREA BEST PRACTICES Strategic Planning

1. What is the organization's vision?

The vision clearly explains what the organization aspires to accomplish.

The Board approves the vision. The vision is communicated to staff, volunteers and other

stakeholders.

2. How does the organization's mission support its vision?

The mission is compatible with the organization’s legal purposes and its vision.

The mission clearly identifies the organization's key stakeholders and how the organization will serve them

The Board approves the mission. The mission is communicated to staff, volunteers and other

stakeholders.

3. What are the organization's values?

The organization has a statement of its values. The organization's strategies are consistent with its values. The Board approves the values and the code of conduct. The values and code are communicated to staff, volunteers

and other stakeholders.

4. Who are the organization's key stakeholders and what do they expect?

The organization has identified its key stakeholders. The strategic plan addresses stakeholder needs. The organization operates in a way that respects

stakeholders and seeks to meet their expectations - without letting them override the organization's values.

The organization monitors stakeholder satisfaction on a regular basis.

5. How does the organization get

the money to fund its activities and programs?

The organization has stable, well-diversified sources of revenue.

The organization is not overly dependent on discretionary government grants.

The organization is prepared to deal with changes in funding levels from one or more of its sources.

5Adapted from "20 Questions Directors Should Ask About Strategy and Planning", CICA, 2008



6. How do events in the organization and the world outside affect our ability to achieve the vision and the mission?

The organization considers its internal strengths and weaknesses in developing its strategic plan.

The organization considers its external opportunities and threats in developing its strategic plan.

7. What risks does the organization face?

The organization has identified the major risks that could affect its operations and provides reports on them to the Board.

Management and the Board consider the risks when developing the strategic and operating plans.

The organization has policies and procedures for managing risks.

The Board makes time in its agenda to discuss risk. The organization takes risks seriously and manages them

well.

8. How much risk is appropriate?

The organization's risk tolerance policy provides a balance between too much and too little risk taking.

The risk tolerance policy is consistent with the organization's capacity for taking risk.

The Board approves the risk tolerance policy and reviews it at least annually.

9. How sound are the assumptions

behind the strategy?

The strategic plan describes the assumptions on which the plan is based.

The strategic planning process includes identifying and testing strategies using some form of scenario analysis.

10. How will accomplishments be

measured?

There are a manageable number of quantitative and qualitative measurements that include the organization's strategic progress.

The measurements are appropriate for monitoring the organization's performance.

The targets are realistic.

11. How will the activities and programs support the vision and the mission?

The strategies use the organization's strengths to take advantage of opportunities and overcome weaknesses and threats.

The strategies are compatible with the organization's values and risk tolerance policy.

The strategic plan links the organization's vision, mission and values to its activities and programs.



12. What is the Board's role in planning?

Responsibility for planning is clearly assigned to appropriate individuals and groups.

The Board's role in planning includes approval of the strategic plan.

The Board schedules sufficient time for effective review and discussion before approving the strategic plan.

Operational and Capital Planning and Budgeting

13. How will the organization achieve its objectives?

The operating plan provides clear direction to staff and volunteers on how strategies will be linked to their activities in the coming year.

The operating plan includes objectives and measurements. The operating plan includes operating budgets. The Board approves the operating plan.

14. How will changes in programs and activities be coordinated?

The plans of staff departments and volunteer committees are coordinated.

The Board considers the need for coordination in its review and approval of the operating plan.

15. What is the budget philosophy?

The budget philosophy is compatible with the organization's risk tolerance policy (e.g. break-even, surplus or deficit?).

The Board recognizes its fiduciary responsibility by approving a budget that is compatible with the organization's budget philosophy (e.g. conservative or aspirational)

16. What does the Board need to

know before approving the operating plan and budget?

The budget report presented to the Board provides comparative information.

The budget includes a cash flow summary. The budget includes plans for investing and borrowing. The assumptions and calculations behind the budget items

are documented. Costs and revenues are calendarized.

17. How much will be needed for buildings, furniture, vehicles and equipment?

The organization has a capital plan and budget. The plan describes the costs and benefits of acquiring

capital assets. The plan includes considerations of alternatives to

purchasing and building. The plan includes the sources of funding for capital

projects. The budget includes a cash flow summary.



Monitoring and Learning 18. How does the Board monitor

progress towards implementing the strategy?

The Board receives regular reports that compare actual performance results to targets.

When actual performance varies from the target, the Board is provided with explanations and any proposed responses.

19. How does the Board monitor

budgeted and actual results?

The Board receives regular reports that compare actual year-to-date and outlook financial results to the budget and the previous year.

When actual and outlook amounts vary from budget, the Board is provided with an explanation and any proposed responses.

20. What did we learn from our

experience? The Board, staff and volunteers take time to learn from

experience. The Board reviews the strategy at least once a year - more

often if necessary. Strategies are revised on the basis of what has been learned.

The Perley and Rideau Veterans' Health Centre BOARD GOVERNANCE GUIDE FOR DIRECTORS

VOL III – GOVERNANCE / Part 4 – Stewardship: Guidance for Good Governance / Ch 3 – Quality (Board Approved 06Feb2014, Rev. 07Sept2017) Page 1 of 10


Chapter 3

QUALITY

This chapter looks at quality from different perspectives, including the Board’s responsibilities for maintaining organizational quality and continuing improvement. It provides guidance on

quality management, performance monitoring and safety management.

3.1 GENERAL Quality begins at the top. The Board and the CEO set the tone that determines the corporate culture of the Perley Rideau. Does that corporate culture promote the pursuit of excellence in every aspect of its activities, around the clock, year in and year out? Is quality part of every employees’ and every volunteers’ personal commitment to the Perley Rideau? The Perley Rideau’s bottom line for quality is focused on the quality of life of its residents and clients. Its motto is: “Together, we improve the well-being the people we serve.” In other words, quality is everybody’s business. In the day-to-day operation of the Perley Rideau it is the staff who are responsible for the quality of the programs; however, at the end of the day it is the Board that is ultimately accountable for the quality of those operations. Thus, the Perley Rideau has a commitment to the delivery of health services that meet or exceed all applicable standards and regulations governing the provision of health care for our residents and other clients. It will actively pursue quality improvements across the entire organization. “Quality” is a relative term that is determined by comparing inherent characteristics with a set of requirements or expectations. Quality defines how well the inherent characteristics comply with the requirements. Not only is quality relative, it is a subjective term, dependent on the eye of the beholder. For example, from the perspectives of: Residents: Quality has to do with the “well-being”1 of the residents;

1 Here “well being” means that the residents “live with dignity and security, safety and comfort, and have their physical, psychological, social, spiritual and cultural needs adequately met,” as required by the LTC Homes Act.



Other clients: Quality has to do with their satisfaction with services provided; Regulatory authorities: Quality has to do with compliance with governing

standards and regulations; Funders: Quality has to do with strong fiscal management; Senior Management: Quality has to do with meeting operational standards within

resource allocations; Unions: Quality has to do with ensuring contented members; Corporate members: Quality has to do with preserving the viability of the

institution; and Board of Directors: Quality has to do with maintaining the Perley Rideau’s

reputation with all its diverse stakeholders. The Board of Directors must seek to satisfy all such perspectives. Sometimes we know formally what the various perspectives are. For example, in 2008 the Ministry of Health and Long-Term Care identified five themes defining a common vision for quality in nursing homes in the province2. These are: i. Create an environment that promotes quality of life for residents; ii. Make “home” a central part of the nursing home experience for residents and their

families; iii. Build a community that supports quality in LTC by leveraging partnerships and

creating a positive image of LTC homes for residents and staff; iv. Create a culture of quality care and improvement; and v. Develop leadership, and align incentives and resources to support the quality

vision in LTC.

3.2 ORGANIZATIONAL QUALITY

Attaining “quality” from one perspective may not be indicative of the organization’s overall health. Satisfying the quality equation from an organizational perspective requires a systematic approach – a quality management system. In other words, quality will be a reflection of the effectiveness of the organizational values and ethics, its structure, procedures and processes, as well as the resources allocated.

3.2.1 Ethics and Values

Inevitably, quality is predicated upon the ethics and values of the Perley Rideau, which are provided in Volume III Part 1 of this manual.

2 “What We Heard: Long Term Care Quality Consultation 2008: A Common Vision of Quality in Ontario Long Term Care Homes”.



3.2.2 Board’s Roles in Quality

This Governance Guide attempts to define the requirements for the governance necessary to ensure “quality” from all perspectives at the Perley Rideau. To that end: The Board regularly reviews the Perley Rideau’s services to ensure that they are

consistent with the purpose of the organization and that its programs are effective and relevant to community needs.

The Board is responsible for establishing a process and a schedule for monitoring and assessing performance in areas of Board responsibility including: o Fulfillment of the strategic directions in a manner consistent with the mission,

vision and values. o Oversight of management performance. o Quality of resident and client care. o Financial conditions. o External relations. o The Board’s own effectiveness.

The Board ensures that management has identified appropriate measures of performance.

The Board monitors the Perley Rideau’s operational and Board performance against Board approved performance standards and indicators.

The Board ensures that management has plans in place to address variances from agreed performance standards and indicators, and the Board oversees implementation of remediation plans.

3.3 QUALITY MANAGEMENT

Quality management includes the activities and functions involved in the determination of quality policy and its implementation in order to sustain the desired level of excellence. There are three generally accepted elements of Quality Management: Quality Assurance is a set of activities intended to establish confidence that the

quality requirements will be met. Quality Control is a set of activities intended to ensure that the quality

requirements are actually being met. Quality Improvement refers to anything that enhances the organization’s ability to

meet its quality requirements.

3.4 QUALITY IMPROVEMENT

Quality improvement is a systematic approach for making changes to lead to better patient/resident outcomes, stronger system performance and enhanced professional development.



Quality improvement goes beyond product or service quality to involve everyone in the organization. It encompasses every function: clinical service delivery, strategic planning, administration, personnel development, communications, etc. It requires: The commitment and direct involvement of senior management in setting quality

goals and policies, allocation of resources, and performance monitoring; Fundamental changes in basic beliefs and practices, making quality everyone’s

business; Building quality into all processes and practices from the outset; Understanding and adapting to the changing needs of residents and clients, all

human resources, and external stakeholders; Leadership so that everyone performs in the best possible manner to improve

quality and productivity; Eliminating barriers between people and departments so that they work together to

achieve common objectives; Providing appropriate training and education; and Defining and monitoring meaningful performance measures.

3.5 QUALITY IMPROVEMENT PLAN (QIP)

As part of its quest for continuous improvement, the Board (through the Quality of Life and Safety Committee) works with the CEO to develop an integrated quality improvement plan. A quality improvement plan (QIP) is a documented set of quality commitments that the organization makes on an annual basis to improve quality through focused targets and actions. Such plans incorporate risk management; performance measurement, including monitoring of strategic goals and objectives; client safety; and quality improvement. The QIP may be based on several quality dimensions, each with specific improvement targets or initiatives. An example of possible quality dimensions and objectives follows; performance measures or indicators would be specified for each item:

Quality Dimension Objective Accessibility Reduce client service wait times.

Advocate for improved transportation services. Safety Reduce infection rates.

Reduce incidence of pressure sores. Reduce falls. Reduce use of physical restraints.

Work life Improve staff scheduling. Reduce use of overtime. Improve staff recognition program.

Client-centred services

Reduce complaints from Friends & Families’ Councils. Improve resident and client satisfaction.



Continuity of Services

Improve coordination of market services. Reduce staff absenteeism and turnover rates. Reduce use of temporary hires.

Effectiveness Reduce unmet accreditation standards. Improve financial health.

Efficiency Reduce transfers to acute care. Improve access to right level of care.

3.6 QUALITY OF LIFE AND SAFETY COMMITTEE

Just as health care organizations require audit committees to oversee financial integrity, they require a quality committee to oversee the quality of services provided. The Quality of Life and Safety Committee assists the Board in overseeing and ensuring the quality of clinical care, quality of life of residents as well as safety of residents, clients, staff, volunteers and invitees at the Perley Rideau. The Terms of Reference for this Committee are in Appendix C of Chapter 3 of Part 2. High preforming health care boards tend to share the following characteristics regarding quality performance: A Board Committee is dedicated to quality oversight; They include quality as an important agenda item at most Board meetings; and They spend a significant proportion of Board time on quality issues. The Quality of Life and Safety Committee assists the Board in this regard. In general terms, its responsibilities include: Working with management to develop and implement a quality improvement plan

that is consistent with the Board-approved strategic objectives; Reviewing and recommending quality/safety-related policies and standards; Approving and monitoring key performance indicators compared to organizational

goals and health sector benchmarks; Reporting on quality and safety performance to the Board; Reviewing sentinel events and root cause analyses and, if appropriate,

recommending corrective action; Monitoring summary reports of clinical care and resident safety activities; Reviewing management’s action plans with respect to negative variances and

serious errors; Overseeing compliance with quality and safety-related accreditation standards; Making recommendations to the Board on all matters related to the quality of care,

resident and client safety, and organizational culture.

A competency-based approach to the selection of members applies as much as is feasible. The Medical Director sits on the Committee to provide the necessary clinical expertise to



advise the Committee. Where the necessary expertise within the Board is missing, Adjunct Advisor(s) may be appointed to this Committee.

3.7 PERFORMANCE MONITORING

A significant part of the work of the Quality of Life and Safety Committee is effective performance monitoring. (Guidelines for performance monitoring are provided at Chapter 8 of this Part.) Not surprisingly, many of the performance indicators pertain directly to quality of life and safety issues. Valuable sources of information for monitoring the effectiveness of the Perley Rideau’s quality management from the perspective of the residents and clients include: Resident Assessment Instrument – Minimum Dataset for trends monitoring and

benchmarking; Certification and Accreditation Surveys (MOHLTC and Accreditation Canada); Satisfaction surveys for residents, clients, families, volunteers and staff; Reports from Stakeholder Committees (Family and Friends Council, Resident

Councils, etc.); and Statements of claim and complaints and their disposition.

The well-being of the Perley Rideau’s residents and clients is directly linked to several other dimensions essential to true total quality management: For example: Financial viability and sustainability; Effective strategic planning; Solid reputation and constructive external relations; Sound management and Board governance; etc.

3.8 SAFETY IN HEALTH CARE

A growing concern in caring for the frail and elderly is having due regard to safety. Accreditation Canada standards for sustainable governance include a section requiring the Board to foster and support a culture of safety throughout the organization. (This section is reproduced in Standards 9, 11 and 12 of Chapter 1 of this Part.) Since 2005 Accreditation Canada has been surveying evidence-based practices that mitigate risk and contribute to improving the quality of safety in health services. Their Required Organizational Practices (ROPs) for safety are organized according to the following areas: safety culture, communication, medication use, work life/workforce, infection control, and risk management. Establishing an effective safety culture begins at the top of the organization with quality governance. A strong relationship exists between an organization’s governance functioning and client safety. Organizations with high-performing boards have been found to have significantly higher rates of compliance with ROPs. Similar relationships



have been identified between the quality of the work life of the staff and client safety. Thus it is important for the Perley Rideau to carefully choose its organizational priorities as to how they may impact on safety culture and work life.

3.8.1 Enhancing Safety in Health Care

The Board has approved a policy on the Culture of Safety for the Perley Rideau. Central to this policy is the recognition that the safety of residents, tenants, clients and their families, and those who provide care and services to them (employees and volunteers) is paramount. This policy can be found in Volume IV of this manual. Translating this organizational commitment into accountability in action can be a challenge. Enhancing system safety can be achieved in healthcare by focusing on particular organizational characteristics, including: Strong roles, activities, and contributions of governing bodies and senior leaders to

establish a common shared vision and culture for safety; Consistent and effective use of evidence-based, standardized care and practices; Ongoing measurement, monitoring, and use of process and outcome data for safety

improvements, including benchmarking, both internally over time and externally, to share important information with peer organizations; and

A focus on enhancing reliability, and analyzing actual and potential events to develop systems that anticipate and mitigate safety risks.

3.8.2 Safety Management System

Given the complexity of issues with safety implications, a systematic approach to overseeing quality in safety management is recommended. A Safety Management Review Checklist is provided at Appendix A to this Chapter to assist in assessing the Perley Rideau’s capabilities for meeting safety expectations.

3.8.3 Safety Health of the Organization

The term safety health reflects the systemic measures put in place by the organization to defend against the unknown and is a reflection of the organization’s ability to adapt to the unknown. In effect, it reflects the organization’s safety culture. Indicators of an organization with good safety health include such considerations as: Proactive corporate safety culture; Investment in human resources in such areas as non-mandatory training; Formal processes for maintaining safety databases, incident reporting and

investigation, safety communications, etc.; Operation of an integrated safety management system (i.e. an appropriate corporate

approach to safety, organizational tools and safety oversight); Risk-based resource allocation;



Strong internal two-way communication in terms of openness, feedback, reporting culture and dissemination of lessons learned; and

Safety education and awareness in terms of data exchange, safety promotion, and participation in safety fora.

**************




SAFETY MANAGEMENT REVIEW CHECKLIST

Audit Area Status of Safety

Management Organization and Planning

A manager has been designated as the focal point for organization-wide safety management.

Terms of reference for all managers identify specific safety responsibilities.

A designated group of experienced operational staff regularly meets with senior management to review safety issues.

This group has a realistic strategy and implementation plan for safety improvement.

Commitment to Safety The CEO is personally committed to improving all aspects of

organizational safety (for residents and clients, staff and volunteers, etc.)

The CEO and the Board have approved the Perley Rideau's safety policy.

Senior management has approved the safety improvement plan. Management promotes a positive safety culture and demonstrates a

trusting (non-punitive) approach to safety violations. Sufficient resources are allocated for critical safety requirements. Safety performance is regularly evaluated.

Hazard Identification An effective safety occurrence-reporting program is functioning for

staff, volunteers, families and friends to report safety incidents, near misses, and unsafe situations or conditions.

Training and promotional information is available to support the occurrence-reporting program.

All identified hazard data are systematically recorded, stored and analyzed.

Safety Analysis Capability A credible safety database is maintained with an appropriate level of

security. Procedures and resources are in effect for competent analysis of safety

issues. Hazard information and quality performance data are routinely

monitored (trend analysis, etc.)



Safety analysis is routinely used to identify and evaluate systemic safety risks.

Risk Management

A competent manager analyzes all identified hazards and, if warranted, recommends viable risk control measures.

Management takes specific action to reduce, eliminate or avoid the risks. Staff are apprised safety actions taken.

Safety Promotion and Training All personnel receive safety indoctrination and participate in specific

ongoing training for safety management. Appropriate means are used for effectively disseminating safety

information and promoting safety. Staff understand that safety management has nothing to do with

attributing blame.

Safety Oversight and Performance Evaluation Safety performance indicators have been agreed and realistic safety

targets set. The Performance Monitoring system includes reporting on safety issues. Regular safety audits are conducted for all operational areas (including

activities of contracting agencies). The safety program's effectiveness is regularly evaluated to ensure that

desired safety outcomes are being achieved.


VOL III – GOVERNANCE / Part 4 – Stewardship: Guidance for Good Governance / Ch 4 – Financial Stewardship (Board Approved 06Feb2014; updated 11May2017) Page 1 of 14


Chapter 4

FINANCIAL STEWARDSHIP

This chapter provides a primer on the Board’s role in financial statements, internal controls and the audit process, and outlines basic building blocks for effective financial stewardship.

4.1 GENERAL Sound financial stewardship is fundamental to the fulfilment of the Board’s fiduciary responsibilities. Although the Board recruits some Board members with professional qualifications and experience in financial accounting and auditing, regular Board members often are relatively unfamiliar with the measures necessary for financial sustainability and accountability. This chapter addresses some of the financial fundamentals and a framework for approaching financial stewardship.

4.1.1 Financial Stewardship1

The Board is responsible to review and approve the annual operating and capital budgets; secure adequate financial resources; ensure development of financial management and inventory control systems to properly record financial transactions and control assets; monitor efficient use of resources; and, ensure the establishment of proper financial controls and policies.

4.1.2 Standards

Accreditation Canada has prescribed a set of standards for governing bodies of health service providers in Canada, including standards for financial planning and control, as well as for the allocation of resources. The standards can be found in Appendix A to Chapter 1 of this Part; standards related to financial stewardship are found under section 9. The Board is responsible for ensuring that these standards are met.

4.1.3 Audit and Risk Management Committee

To assist the Board in achieving its financial stewardship responsibilities, it is supported by the Audit and Risk Management Committee. The Terms of Reference

1 From “Governing for Results: A Director’s Guide to Good Governance”, Mel D. Gill, 2005



for this Committee are reproduced at Appendix D to Chapter 3 of Part 2 of this Volume.

4.2 FUNDAMENTALS

To assist new Board members in understanding effective financial stewardship, following is a primer on terminology.

4.2.1 Assets Assets comprise the physical plant and equipment, cash reserves and even the Perley Rideau’s reputation. The Board collectively is responsible for ensuring that all assets are prudently managed and safeguarded. All Board members and Committees share in this responsibility. In particular, failure to renew and update plant and equipment, depletion of cash reserves, overly optimistic plans and projects, or an erosion of public goodwill will compromise the Perley Rideau’s long-term viability. While trust and respect are essential to the Board-management relationship in fulfilling these responsibilities, blind trust in the CEO’s budget and reporting practices may damage the Board’s credibility and the sustainability of the Perley Rideau.

4.2.2 Liabilities

A liability is an obligation on the Perley Rideau arising from past transactions or events, the settlement of which is expected to result in an outflow of the Corporation’s assets yielding economic benefit to the holder of the obligation. A liability may be of many forms; for example: Borrowing from persons or banks for improving the business or performance of

the Perley Rideau for either the short or the long term; Contractual obligations to provide a service or an asset over a specified period

or at a predetermined date (such as negotiated pay and benefits agreements, the obligations of the LTC Home Service Accountability Agreement with the LHIN, etc.);

Other obligations resulting in a duty or responsibility to comply with little or no discretion to avoid settlement (such as fines or loss of a lawsuit.); or

Outstanding obligations from past transactions or events that still obligate the Corporation to pay.

Liabilities need not be legally enforceable; but can be based on equitable obligations or constructive obligations. An equitable obligation is a duty based on ethical or moral considerations – such as the Perley Rideau’s practice of providing pay increases for non-unionized employees comparable to those of unionized employees. A constructive obligation is an obligation that is implied by a set of circumstances in a particular situation, as opposed to a contractually based obligation.



4.2.3 Unfunded Liabilities

Unfunded or contingent liabilities can lead to bankruptcy. Unfunded liabilities may occur when contractual obligations exceed the organization’s revenue generating capacity. Commitment to major projects with inadequate project funding, the cumulative effect of sick leave or unplanned buyouts for laid off employees, etc. with insufficient cash reserves or contingency funding, all may lead to such a cash crunch - especially if a major cut in the Perley Rideau’s core funding occurred in the same time frame.

4.2.4 Financial Statements

Three different financial statements are fundamental to the Board’s financial stewardship of the Perley Rideau. Each is prepared by management, reviewed and recommended by the Board and is ultimately approved by the Corporation at the Annual Meeting. The three financial statements are: Statement of Financial Position (formerly called the Balance Sheet) reflects the

organization’s overall financial situation at a point in time. It portrays the organization’s assets balanced against its liabilities and net worth. Assets include all the things of value owned by the Perley Rideau. Liabilities represent the organization’s obligations to creditors; i.e. what it owes. (Contributions that have not yet been amortized are considered to be owing.) Net assets are the difference between what the Perley Rideau owns and what it owes; i.e. it represents the Perley Rideau’s own investment in the Corporation, its “worth” and may be positive or negative.

Statement of Revenues and Expenditures (over a period of time) summarizes

the Perley Rideau’s revenues and expenditures incurred during the period. Revenues include the actual income received plus any contributions that have been amortized during the period (usually a year). Expenditures include all payments for goods and services during the year, plus that portion of long-term assets recognized as expenses during the year (such as depreciation on the physical plant).

Statement of Cash Flow. Essentially, the cash flow statement is concerned with

the flow of cash in and cash out of the Perley Rideau. It is an indication of the organization’s solvency. It shows how changes in the Perley Rideau’s accounts and income as reflected in the Statement of Financial Position affect the Corporation’s actual cash and cash equivalents position over a defined period of time. Starting with the difference between revenues and expenses, this statement adds back those expenditures that did not require cash during the year (such as depreciation) and subtracts those revenues that did not involve cash during the year (such as those contributions which were amortized during the year.) The net result represents the cash and cash equivalents available to the Perley Rideau



at the end of the year. As an analytical tool, it is useful in determining the short-term viability of the organization, particularly its ability to pay its bills.

4.2.5 Annual Operating Budget

The annual operating budget (revenues vs. expenditures) and operational plans that are approved by the Board form the Board’s basis for monitoring current year financial performance. These are always reviewed in the context of recent history and future projections. The Board receives and reviews regular reports (at least quarterly) from management on year-to-date actual revenues and expenditures with projections for the balance of the fiscal year. In this way, the Board avoids surprises, keeping the organization on track for the budget plan and anticipating any budget shortfalls or surpluses. In this monitoring function, the Board satisfies itself that management’s reports would stand up to rigorous outside scrutiny and professional audit. In this regard, the Board is responsible for ensuring that the Perley Rideau’s accounting practices conform to ‘Canadian Generally Accepted Accounting Principles (GAAP)’, that professional audits are conducted at least annually, and that problems identified in previous audits have been corrected (or that there is sound financial argument for disagreement with particular recommendations).

4.2.6 Internal Controls

Internal controls are the systems of policies and procedures that protect the assets of the Perley Rideau, create reliable financial reporting, promote compliance with laws and regulations and achieve effective and efficient operations. These systems are not only related to accounting and reporting but also relate to the Perley Rideau’s communication processes, internally and externally, and include procedures for:

Handling funds received and expended by the organization; Preparing appropriate and timely financial reporting to Board members and

officers; Conducting the annual audit of the organization’s financial statements; Evaluating staff and programs; Maintaining inventory records of real and personal property and their

whereabouts; and Implementing personnel and conflicts of interest policies.

Financial Audit

An audit is an examination and evaluation of policies, procedures, and systems to ensure the reliability and integrity of information; compliance with policies, plans, laws, and regulations; the safeguarding of assets; and the economical and efficient use of resources. The auditing activity is broadly defined as a process to provide reasonable assurance of the achievement of the following objectives:



i. Effectiveness and efficiency of financial operations; ii. Reliability of financial reporting; and iii. Compliance with applicable laws and regulations. Auditing may be conducted internally or externally. The Perley Rideau at present does not have a system in place for conducting internal audits. Rather, an external audit is conducted annually and is focused on an examination of the statement of financial position as prepared by management of year-end. The auditors render an opinion based on their examination of the statements of revenues and expenditures, changes in net assets and cash flows. Although the auditors may bring to the Board’s attention particular issues regarding internal controls, they do not provide an opinion on the adequacy of these controls. The Board must ensure that management has established and implemented effective internal controls for the maintenance of the continued financial viability of the Corporation.

4.3 FRAMEWORK FOR FINANCIAL STEWARDSHIP

Effective financial stewardship at the Perley Rideau is built upon six basic building blocks:

4.3.1 Organization

To some extent, how the Perley Rideau structures its human resources and responsibilities is a derivative of the legislative and regulatory requirements as well as the By-Laws. However, the devil is in such details as: Authorities. These are clearly defined in terms of signing authorities and

spending limits, and formal reporting lines are established and respected. The terms of reference for the Chairman and Officers of the Corporation and the CEO are also clearly defined. The CEO is accountable to the Board for the management of day-to-day financial operations. See Appendix A to this Chapter for a description of the CEO’s responsibilities with respect to financial stewardship.

Personnel. Management has sufficient staff with appropriate credentials and

work experience for overseeing the day-to day financial management of the Corporation.

Audit Committee. An Audit and Risk Management Committee of the Board

oversees the effective utilization and safeguarding of the Perley Rideau’s assets in the fulfilment of its mission and the sustainability of its financial health.



Financial Competence of Directors. A sufficient number of Board members with professional financial credentials and significant financial work experience are recruited to provide financial leadership for the Board. In addition, the Board ensures that Board members have adequate training and orientation in the fundamentals of financial management to contribute to the challenge and review processes for all Board deliberations of financial matters. Notwithstanding the foregoing, the Board will seek outside professional financial counsel when deemed necessary.

4.3.2 Planning

Effective financial stewardship begins with sound financial planning, meaning:

Strategic Management. All financial planning is supportive of the Perley

Rideau’s values, vision, mission and strategic objectives. The Board in collaboration with management follows a regular cycle of strategic thinking (reviewing the corporate values, vision and mission), analysis (of the current and projected operating environment, threats and opportunities) and performance review (measured against specific targets and budgets). All major decision making with strategic implications (whether planned or unplanned) is weighed against the long-term interests of the Perley Rideau. (For guidance on strategic management, see Chapter 2, Part 4, of this Volume.)

Securing Financial Resources. The Board is directly responsible for ensuring

that adequate revenues are secured for the effective operation of the Perley Rideau and for its long-term sustainability. Normally, the Board delegates authority to management for the negotiation of funding formulae with government funders and setting the operational priorities for revenues from the Foundation, as well as for securing and managing sundry revenue enhancement sources. However, as with many other governance matters, the CEO and Board work in full partnership to ensure that the necessary revenues are secured.

Board vigilance is required to maintain organizational credibility, monitor trends, anticipate problems and manage risks. The Board reserves the authority to approve all new funding initiatives (e.g. project grants, fees for service, and new funding streams).

Operating Plan. Based on the strategic directions contained in the Strategic

Plan, management prepares an annual Operating Plan that contains more specific objectives than contained in the Strategic Plan. The Board challenges and approves the Operating Plan. These objectives become the focus of work throughout the Perley Rideau over the next twelve-month period. They will contain estimates of service demand for the year as well as objectives for improvement in key areas of corporate activity.



The operating plan will contain such details as: o Expected results for each objective; o The time period during which those results will be sought; and, o Criteria for measuring the achievement of those results. The annual operating plan, together with service statistics and budget forecasts are presented to the Board for review, amendment and approval.

Operating Budget. The annual operating plan provides the basis of the Perley

Rideau’s annual budget containing revenues and expenditure forecasts related to planned programs and/or volumes of service.

Capital Budget. In addition to the Operating Budget, management prepares an annual capital budget for approval by the Board. The capital budget addresses such longer-term requirements as major maintenance and upgrade of plant and facilities, equipment replacement, new capital projects, etc. Capital budgeting requires consideration of such aspects as net present value and equivalent annuity values for paying off major initiatives, return on investment, etc.

4.3.3 Policies, Process and Guidelines

Policies, Process and Guidelines provide the lubricant to keep the financial machinery running smoothly. For example:

Administrative. All financial administration policies, accounting systems,

internal financial standards, management authorities, controls and practices are established and maintained in accordance with legal and regulatory requirements. Furthermore, they are well documented and are diligently applied, reviewed and updated as necessary to ensure effective financial operations.

Internal Controls. A primary responsibility of Directors and Officers is to

ensure that the Perley Rideau is accountable for its programs and finances to its government regulators, its residents and clients, staff, corporate members, donors, and the public. Accountability requires that the Perley Rideau comply with all applicable laws and ethical standards; adhere to the organization’s mission; create and adhere to conflict of interest, ethics, personnel and accounting policies; protect the rights of members; prepare and file its annual financial report to the appropriate regulatory authorities and make the report available to all members of the Board and any member of the public who requests it. The development and maintenance of the Perley Rideau’s internal controls help to fulfill this accountability; an example is the Perley Rideau’s policy on Delegated Signing Authority.



Contracting. The Perley Rideau has defined procedures for approving contracts with consultants and suppliers, including securing competitive bids. Management has defined spending limits and contractors must be qualified and eligible to bid and be free from conflict of interest, etc. All contracts must be capable of withstanding outside scrutiny. The Board will approve contracts of a defined size.

Investment and Borrowing. The Board ensures that the Perley Rideau has a

prudent investment policy in effect taking account of the financial capacity of the organization. The Board also establishes the terms and conditions for any borrowing on the credit of the Corporation (as per article 16 of the By-Laws). The Board annually reviews the terms of its short- and long-term debt to assess liabilities and potential risks.

Insurance. As part of its risk management program, inter alia the Board

annually reviews the terms and adequacy of insurance coverage for the Perley Rideau, including indemnification for Directors (as per article 10 the By-Laws).

4.3.4 Performance Monitoring

Performance Monitoring is an essential element of financial stewardship and risk management. Few aspects of the Perley Rideau operation are better suited to quantifiable or measurable performance indicators as the financial indicators such as surplus/deficit, profit/loss, etc. The availability of audited financial statements and other routine financial records facilitate the analysis of trends, the setting of realistic financial objectives, etc. Meaningful performance indicators and realistic financial benchmarks and targets are applied for measuring the efficient use of the Perley Rideau’s financial resources. Reporting. The Board is regularly provided adequate information to assess the

financial performance of the Corporation and the integrity of its internal reporting and control systems. It periodically reviews financial statements (actual revenues and expenditures) against budget, assesses trends and identifies adjustments deemed necessary for exceptional expenditures.

Risk Management. The Perley Rideau follows a coherent framework of policies

and processes for managing risks (including financial risks) across the entire enterprise. These include: promoting a culture of risk awareness, identifying and assessing risks that could affect the achievement of the strategic objectives, and learning from the Perley Rideau’s experience. Sound financial policies and procedures (as established herein) minimize the potential for financial loss. For policies and guidance on the Perley Rideau’s enterprise risk management, see Chapter 7, Part 4, of this manual.



4.3.5 External Financial Audit As required by law and by the Perley Rideau By-Laws, the Corporation selects an external auditor to conduct an annual financial audit for approval by the corporate members. The Board determines the terms of reference for and the performance of the external auditors, reviews the audit results, ensures that the financial statements are fairly presented in all material aspects in accordance with generally accepted accounting principles, meets with the auditors independently from the CEO and considers the auditors’ management letter, and directs necessary follow-up actions with respect to the auditors’ findings.

4.3.6 Accountability

Maintaining the integrity of the Perley Rideau, thereby ensuring its continued viability requires strict financial accountability. Some aspects of this public accountability derive from legislative requirements, others from a corporate culture of openness. Reporting. Management provides the Board with accurate, comprehensive, and

timely information. All financial, organizational, and program reports shall be complete and accurate in all material respects. The Perley Rideau promotes a culture of openness and duty whereby employees or volunteers feel free to report any evidence of fraud or financial impropriety to the Board or the Audit and Risk Management Committee without fear of sanction of any form.

Public Disclosure. Little inspires confidence in and willingness to work

together with the Perley Rideau more than openness in the disclosure of information that need not be protected (even if it is unfavourable information). Therefore, basic operations and financial data, including approved budgets, revenues and expenses versus budget, and audited financial statements are posted on the Perley Rideau website. In addition, the financial statement as presented by the external auditors is formally presented at the annual Meeting of the Corporation. Further, public disclosure of information is supported by a policy on Disclosure of Information that is found in Volume IV of this manual.

4.4 REVIEW OF FINANCIAL STEWARDSHIP

The Review Checklist for Financial Stewardship at Appendix B provides further guidance for the Audit and Risk Management Committee and the Board in its oversight role for the financial stewardship of the Corporation.

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Appendix A


CEO’S RESPONSIBILITIES RE FINANCIAL STEWARDSHIP2

1. Prepare the annual budget for consideration by the Corporation's Board.

2. Manage the operation of the Corporation's programs within the approved budget, subject

to variance in demand and exceptional circumstances. 3. Provide periodic expenditure forecasts and financial reports to the Board. 4. Ensure the development of systems for monitoring and controlling expenditures within

approved budget levels. 5. Secure, with the assistance of the Board, the resources necessary to implement and

maintain the Corporation’s programs. 6. Provide periodic reports as required to funding authorities. 7. Ensure the development and maintenance of "risk management" policies and procedures

that will minimize financial, public relations and other liabilities for the Corporation, its Board, staff, volunteers, agents and clients.

2 From “Governing for Results” Mel D. Gill, 2005




REVIEW CHECKLIST FOR FINANCIAL STEWARDSHIP3

1. Internal Controls: Does the Perley Rideau have procedures for:

a. Handling funds received and expended? b. Preparing appropriate and timely financial reporting to Board members and

officers? c. Conducting the annual audit of the Corporation’s financial statements? d. Evaluating staff and programs? e. Maintaining inventory records of real and personal property and their

whereabouts? and f. Implementing personnel and conflicts of interest policies?

2. Implementation and Monitoring of Internal Financial Controls: Does the Perley Rideau have and implement agreed procedures for:

a. Monitoring Assets including:

i. Preparing an annual budget and periodic reports? ii. Signing and recording cheques? iii. Receiving, recording, and securing all income, grants, contributions cash,

and any other receipts? iv. Requisitioning, authorizing, verifying, recording and monitoring all

expenditures? v. Accessing, inputting and changing electronic data maintained by the Perley

Rideau, and creating and maintaining an effective off-site, records back up system?

vi. Providing for regular oversight by the Audit and Risk Committee? vii. Reporting any allegations of fraud or financial improprieties? viii. Ensuring that timely and appropriate reports are distributed to all Directors

and officers? ix. Approving contracts, including securing competitive bids? x. Clearly identifying the responsibilities of all individuals working for the

Perley Rideau, including staff, Directors, volunteers and contractors, and maintaining a current organizational chart?

xi. Preparing for the annual audit? xii. Maintaining and overseeing a prudent investment policy? xiii. Complying with all governmental and other reporting requirements?

3 Adapted from “Internal Controls and Financial Accountability for Not-for-Profit Boards”, Attorney General Andrew Cuomo, New York, NY



xiv. Meeting obligations to stakeholders for communicating the Corporation’s annual financial statement?

b. Definition of Roles including:

i. Maintaining up-to-date job descriptions for all positions, including staff, Directors and other volunteers?

ii. Clearly communicating the Board’s expectations of the CEO?

c. Human Resources Policies including vacation and sick leave, ordinary and overtime compensation, other benefits, grievances (including protection for “whistle blowers”?

d. Training including orientation for new Directors as well as staff training on

financial controls? e. Maintaining and overseeing its Code of Ethics and Conflicts of Interest Policies? f. Sustaining an effective Audit Committee including:

i. Committee selection requirements, appropriate terms of reference, etc.? ii. Selection of the independent external auditor? iii. Meeting with the independent external auditor to discuss their findings? iv. Evaluating recommendations for any necessary changes? v. Confirming all federal and provincial taxes and other deductions have been

actioned? vi. Periodically reviewing insurance requirements? vii. Reviewing any legal matters that could affect the Corporation’s financial

position?

g. Reviewing systematically the Corporation’s governance structure, procedures and programs?


VOL III – GOVERNANCE / Part 4 – Stewardship: Guidance for Good Governance / Ch 5 – Human Resources Stewardship (Board Approved 06Feb2014; Rev. 07Sept2017) Page 1 of 13


Chapter 5

HUMAN RESOURCES STEWARDSHIP1

This chapter defines key areas of Board responsibility for Human Resources (HR) and provides guidance to the Board for overseeing HR policies and practices and for the periodic review and audit of the effectiveness of the Perley Rideau’s HR stewardship.

5.1 GENERAL

As part of its responsibility for the long-term sustainability of the Perley Rideau, the Board provides oversight to all resource management including Human Resources (HR). The Perley Rideau’s staff and volunteers are fundamental to the fulfillment of the organization’s mission – a true sine qua non. A full complement of trained and competent staff, volunteers and contracted service providers is essential to the quality of life for the residents and clients of the Perley Rideau.2 Broadly speaking, HR has to do with the building and preservation of human capital. This includes such key HR functions as:

Maintaining awareness of and compliance with governing legislation and

regulations impacting on HR; Recruitment and selection of personnel, retention and succession planning; Employee record keeping and confidentiality; Organizational design and development; Business transformation and change management; Performance and behaviour management; Industrial and employee relations; Workforce analysis and personnel data management; Compensation and employee benefit management; Training and development (learning management); and Employee motivation and morale-building (employee retention and loyalty).

1Much of this Chapter was adapted from “20 Questions Directors of Not-For-Profit Organizations Should Ask About Human Resources”, Canadian Institute of Chartered Accountants, 2011.2 These personnel account for approximately 80 percent of the Perley Rideau’s operating budget.



The intent of HR management is to create a workplace where:

Staff and volunteers value their work experience at the Perley Rideau; Legal requirements are met; Best practices appropriate to the organization are documented and implemented; Management decisions and action are consistent, uniform and predictable; Individuals and the organization are protected from the pressures of expediency;

and Organizational values are promoted.

5.1.1 HR Management Policy Framework3

Managing the day-to-day aspects of maintaining an effective workforce is essentially the domain of the CEO. It is management’s responsibility to develop and implement policies and procedures for meeting legislated work requirements and fulfilling the mission and strategic directions of the Perley Rideau in consonance with its ethics framework and its core values. In developing the Perley Rideau’s operational policies for HR management, the following principles should be met: Reinforce compliance with legal requirements. Support active and positive approaches to working with employees. Contribute to a fair and equitable work environment. Support organizational excellence in governance and accountability. Act as a foundation for individual learning and organizational improvement. Provide tools that will build organizational capacity, credibility and effectiveness by

supporting: o Current and future employees in their work and career; o Donors and funders in identifying the Perley Rideau as an organization with a

demonstrable commitment to excellence in employee relations; o Potential partners gauging the Perley Rideau’s sustainability; etc.

5.1.2 Board Responsibilities

The Board of Directors has three key areas of responsibility with respect to human resources. Relationship with the Chief Executive Officer. The Board is responsible for all

aspects of the relationship with the CEO including selection and hiring, support and performance management, succession planning and replacement.

3Adapted from “HR Management Standards”, HR Council for the Voluntary & Non-Profit Sector, 2009



Compensation. The Board is directly responsible for setting the compensation of the CEO. In addition, the Board approves the overall compensation philosophy of the Perley Rideau.

Oversight of HR Management. The Board is responsible for overseeing the establishment of the Perley Rideau’s HR policy framework that governs all of the organization’s human resources necessary to fulfill the Perley Rideau’s strategic objectives.

5.2 CHIEF EXECUTIVE OFFICER (CEO) The importance of the Board’s relationship with the CEO is so vital to the operating effectiveness of the Perley Rideau that a separate chapter is devoted to the subject (see Part 3 – Executive Authority, Chapter 1, Chief Executive Officer).

5.3 COMPENSATION

Most Perley Rideau employees are unionized, many on contracts dating back before the Health Centre was designated a Long-Term Care home. The Perley Rideau participates in these union contract negotiations. However, the Perley Rideau has relatively little influence in setting compensation philosophy and practices for such unionized staff. Nevertheless, the Board is responsible for overseeing the compensation philosophy and practices of the Perley Rideau. In this it is guided by the following principles for deliberating compensation matters including:

Compensation is effective in that it is consistent with the Perley Rideau’s strategic

objectives; Compensation is responsible in terms of value and cost, reflecting a wise use of the

Perley Rideau’s resources; and Compensation is defensible in that it can be explained and justified to stakeholders. Compensation will be benchmarked to compare the Perley Rideau’s compensation

practices with similar LTC homes and health care facilities; Overall, Perley Rideau compensation should reflect internal equity such that

similar roles within the Perley Rideau are compensated in a similar manner. To this end, the Perley Rideau has awarded pay increments for non-unionized employees that are consistent with negotiated gains in pay and benefits achieved by unionized groups.

Compensation will be set in consideration of non-monetary benefits such as working environment, flexible hours, and opportunities for development.

5.4 OVERSIGHT OF HR MANAGEMENT

The third element of the Board’s responsibilities for human resources is overseeing the HR policies and practices of the Perley Rideau. While this is largely an oversight function, there are some elements, such as setting the “tone at the top” for which the Board has primary responsibility. The Board approves HR policies that have legal



implications for the Perley Rideau or may adversely affect the Perley Rideau’s reputation (e.g. compensation guidelines, screening criteria, discipline and terminations, harassment, etc.) The Board is assisted in its oversight of HR Management by three Committees. a) The Audit and Risk Management Committee attends to all financial matters of

potential Board concern pertaining to those aspects of Human Resources affecting the financial viability of the Corporation (e.g. contracting, pay and benefits, severance benefits, long term HR requirements, etc.).

b) The Quality of Life and Safety Committee attends to all matters of potential Board concern pertaining to the interface of staff, contractors and volunteers with residents and clients which affect or could affect their quality of life or safety (e.g. credentials, training and development, plant and equipment, operational practices, service delivery, discipline, etc.).

c) The Stakeholder and Community Relations Committee reaches out to communities of service providers and focuses on relationship building. This may entail providing counsel to other Committees on how best to interface with such entities when developing formal partnerships, negotiating contracts, etc.

5.4.1 Tone at the Top

The Board sets a tone at the top, which establishes a corporate culture of ethical practices and behaviour. Board members do this by ensuring that their own behaviour meets the highest ethical standards, and by requiring the same of the CEO and other senior staff. The Perley Rideau has codified the expected behaviour governing all transactions involving the Perley Rideau in Part 1, Ethics and Values, and Part 2, Chapter 4, Directors – Duties, Obligations and Liabilities, of the Board’s Governance Guide.

The Perley Rideau’s Code of Ethical Conduct and Core Values apply to all paid employees, volunteers, and anyone doing business at the Perley Rideau, and are therefore key vehicles for:

Setting the boundaries of acceptable behaviour; Informing employees, volunteers, consultants, contractors, and suppliers doing

business with the Perley Rideau of expectations regarding acceptable behaviour; Reducing the risk and costs of fraud, conflicts of interest and other ethical

deviations; and Providing the basis for sanctions against those that deviate from these codes.

Appropriate screening of both paid staff and volunteers is most important to the maintenance of these high ethical standards. When recruiting new Board members, paid employees, consultants and volunteers, they should be apprised of the Code of Ethical Conduct and Core Values, with the expectation that they will be respected. If warranted, appropriate criminal background checks should be required as a condition of paid



employment and for some volunteers. In addition they are expected to sign conflict of interest declarations and confidentiality agreements.

5.4.2 Laws and Regulations Governing HR Although management is responsible for the details of implementing the applicable laws and regulations for sound HR governance, the Board has a responsibility in overseeing compliance. A wide range of laws and regulations (federal and provincial) govern the workplace raising a parallel set of potential concerns to Board members. Sample areas for consideration include: All employees are eligible to work in Canada; All required source deductions are being budgeted and paid for (e.g. CPP, EI,

income tax, workers’ compensation, etc.); Employment records are being maintained in accordance with current requirements; All employment standards are being fully respected (e.g. minimum wages,

vacations, hours of work and overtime, record keeping, etc.); Human rights are being respected (e.g. with respect to discrimination, harassment,

and workplace accessibility); All relevant occupational health and safety requirements are being fully

implemented (e.g. safety precautions, equipment and training, etc.); All corporate policies are being adhered to.

5.4.3 Potential Liabilities for Board Members

Organizations that fail to meet their obligations to employees can face serious investigations and lawsuits, fines and sanctions against the organization. There are some laws under which Directors could be held liable for failing to meet their obligations. Example areas of potential liability for individual Board members include failures to meet the HR obligations of:

Long-Term Care Homes Act; Income Tax Act (e.g. failure to make required deductions); Occupational health and safety legislation (e.g. failure to implement basic health

and safety precautions); Employment standards (e.g. unpaid wages and vacation pay, unlawful dismissal). Employee Terminations. Another major area of potential liability to the Perley Rideau and of concern to Board members includes termination of employees. The concomitant costs of terminations can be significant in terms of money, employee morale and reputation. Although termination of an employee is the prerogative of the CEO, he/she may seek the counsel of the Board – particularly if there are significant numbers of layoffs required.



(The Board may also find itself in a position of having to terminate its relationship with the CEO.) Terminations may be of two types: Termination for Cause. When an employee engages in conduct that can be legally

justified as cause for termination (including misconduct or continuing performance problems), the Perley Rideau has the right to terminate the employment relationship immediately with no notice or payment in lieu of notice. In such cases, legal advice may be wise before proceeding with a decision to terminate an employee on a “for cause” basis.

Termination without Cause. Such terminations require advance notice in writing -

usually in accordance with an employment contract or collective agreement. The terms for these terminations include such things as severance pay, pay in lieu of service, return of contributions, etc. Since the stakes are high, it is not unusual for an employee being terminated to file a formal complaint. If a court finds that the organization failed to meet its obligations, the award against the organization can be substantial – including a possible order for reinstatement. In view of the potential costs and organizational harm of complaint, termination of employment requires the utmost of care. The CEO is responsible for keeping the Board apprised of developments concerning terminations that may lead to a formal complaint.

5.4.4 HR Strategy and Policies

When overseeing the Perley Rideau’s HR policies and practices, Directors have a key strategic role, both in guiding and approving the organization’s talent recruitment and retention strategy, and in overseeing the policy framework that establishes the way the Perley Rideau’s human capital will be managed. To that end, management is responsible for: Developing an overarching HR strategy and implementation plan to achieve the

Perley Rideau’s long-term strategic plan; Maintaining a set of documented HR policies to guide the performance of all HR

functions. These policies must be consistent with all relevant legislation and regulations, human rights codes, employment standards, workplace and occupational health and safety standards, etc. They will be updated as required in accordance with regulatory requirements and in response to evolving operational circumstances in consonance with best industry practices.

Providing an HR report (at least annually) to the Board on progress, challenges and risks associated with the fulfillment of the HR strategy and implementation plan.

In its HR oversight, the Board should take into account such considerations as: Compliance with relevant regulatory requirements; Support for the well-being of the employees and volunteers;



Occupational health and safety; Diversity and inclusion in recruiting; Background checks and screening; Processes for dealing with complaints, including investigations; Zero tolerance for reprisals, harassment or bullying; Accessibility of policies for staff referral; etc.

5.4.5 Employment Relationships

The obligations of the Perley Rideau to the individuals of its work force depend on whether they are employees, contractors or consultants, or volunteers. The Board is responsible for overseeing these relationships, satisfying themselves that all relationships are appropriately classified and documented making clear the rights and obligations of both the individual and the Perley Rideau. The Perley Rideau’s HR policies and practices must differentiate in application between employees, contractors or consultants, and volunteers. In particular, attention is required to avoid establishing relationships with contractors or consultants that de jure would be deemed to be employer-employee relationships. Nor should volunteers be put in a situation that may be deemed to be employment; this is especially so for employees who may also volunteer extra time at the Perley and Rideau. Employees. Most Perley Rideau employees are unionized and the employer - employee relationship is governed by the fine print of the collective agreement. A few employees may be signatory to a personal service contract, which also should define the agreed terms of the relationship. To the extent practicable the Perley Rideau should strive to maintain fairness and internal equity among all its employees whether they are part of a collective agreement, personal services contract, or not.

Independent Contractors or Consultants bring specialized skills and expertise to the Perley Rideau for particular short-term tasks with clearly defined deliverables. To avoid potential liabilities downstream these relationships must be carefully managed. To that end, the Board should satisfy itself that:

Clearly written policies and sound corporate practices govern the use of consultants; Procurement practices are fair, open and transparent; Contracts clearly define not only the deliverables, but also the nature of the

relationship, including the rights and duties of all parties; Assignments are well defined, justified and understood before work starts; Individual contracts set clear ceiling prices; Payments to consultants are tied to specific deliverables; and Performance of consultants is carefully reviewed and managed. Volunteers. Since a significant volunteer workforce contributes directly to the well being of the residents of the Perley Rideau, Directors should also be assured that appropriate



policies and documentation governing the use of volunteers are in place. These policies for volunteers should address such issues as:

Volunteer recruitment and continuing engagement in the service of the Perley

Rideau; Volunteer screening, including background checks and possibly checking criminal

records; Job descriptions, depending on the role of the volunteers and the expected period of

commitment; Volunteer agreements whereby volunteers acknowledge their roles and their

acceptance of the Perley Rideau’s code of ethics, and its confidentiality and conflict of interest policies;

Training, supervision and management to ensure that the volunteers are performing their duties in a safe and effective manner;

Recognition and awards for particularly meritorious service and/or longevity as a Perley Rideau volunteer.

5.4.6 Hiring Senior Management

The hiring of staff and senior management is the prerogative of the CEO. However, in fulfilling its mandate for oversight of the Perley Rideau and preserving its legitimacy and reputation, the Board necessarily has an interest in the selection of the senior management team. The Board would be interested in persons who might logically be considered in any future succession planning for the CEO’s position. Also since senior managers are often called upon to interface directly with the Board, it is important that there be an effective working relationship between the two, i.e. the Board perceives a good “fit” with the candidate. To that end, it is recommended that the CEO keep the Board fully apprised of candidates and their progress in the selection process. The CEO may seek the counsel of the Board regarding particular candidates. However, it is not the Board’s decision; the CEO has exclusive authority for the hiring (and if necessary termination) of all senior managers.

5.4.7 Succession Planning

The CEO is responsible for maintaining a succession plan for his/her eventual replacement and for succession within the senior management team. See Chapter 1 of Part 3, Executive Authority, for further guidance in this respect. The Board is responsible for the ongoing maintenance of a succession plan for the replacement of outgoing Board members and for selecting, training and developing new members so that overall the Board has the necessary skills and competencies to fulfill the Board’s mandate. See Chapter 5, Board Development in Part 2, The Board of Directors, for guidance in this respect.



5.5 PERIODIC REVIEW AND AUDIT

Management will ensure that all HR policies are effectively put into daily practice throughout the Perley Rideau. To this end, management is responsible for implementing a program of regular review and formal audit to confirm alignment between policy and practice. Regular HR audits are a useful tool for evaluating the effectiveness of HR governance in fulfilling the Perley Rideau’s strategic objectives. As part of its strategic planning, the Board regularly conducts environmental scans to keep abreast of both external and internal factors that may impact on or compromise fulfillment of the Perley Rideau’s vision, mission, strategic goals or objectives. This scan includes considerations related to HR practices. To help the Board evaluate how effectively the Perley Rideau’s HR management policies and practices are being implemented, a review checklist is provided at Appendix A to this Chapter.

5.6 REPORTING TO THE BOARD The CEO provides a comprehensive review of HR performance during the prior year and an assessment of the evolving HR situation vis-à-vis the Perley Rideau’s strategic objectives.

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HUMAN RESOURCES REVIEW CHECKLIST4 1. HR management Policy Framework and Employment Legislation

a. Are HR management policies formalized, documented and approved by the Board? Are these policies easily accessible by management, employees and key stakeholders, and do they include those issues that govern the work and actions of employees such as: Conflict of interest, Working conditions, Compensation and benefits, Vacation and sick leave, Performance management, Staff development, Harassment, Formal complaint process, and Confidentiality, etc.?

b. Do HR management policies comply with employment, workplace health and safety, and other related legislation as applicable in the jurisdiction in which the Perley Rideau operates? Does the CEO periodically review compliance with this legislation and provide a report to the Board at least annually?

c. Are HR management policies reviewed on a regular basis and revised, if necessary, taking into account changes in legislation and best HR management practices?

2. Getting the Right People

a. Is an approved job description completed for all positions? Are these reviewed annually to ensure that they are aligned with the strategic direction and structure of the organization? Do changes in job descriptions trigger a review of compensation rates?

b. Is recruitment done through an objective, consistent process that assesses both internal and external candidates by the same criteria?

c. Are criteria used to select the appropriate individual established and documented? Is information collected through the selection process treated in conformance with privacy legislation?

d. Do all individuals external to the organization who are offered a position sign a letter of employment that outlines the working relationship between the individual and the Perley Rideau?

e. Are all new employees oriented to the position and to the organization? Does 4Adapted from “HR Management Strategies” by the HR Council for the Voluntary and Non-Profit Sector, 2009



orientation include such topics as HR policies and procedures, the Perley Rideau’s mission, vision, values, and structure, respective roles of staff and volunteers, and job expectations after 3 and 6 months and 1 year?

f. Are there plans to address any potential key employee turnover so that the organization’s clients and public continue to receive programs and services? Are key positions identified that require backup to ensure continuity of service? Are significant potential gaps in these key positions proactively identified?

3. Managing People and Their Work

a. Are managers and supervisors with the responsibility for managing the efforts of

others provided with appropriate learning opportunities to develop their supervisory skills?

b. Do all employees have a work plan and performance objectives that identify the tasks/activities and expected results for future performance?

c. Is the performance of each employee fairly assessed, at least annually, at the end of the work plan or performance period? Are performance reviews systemic, not only assessing past performance against standard evaluation criteria, but also encouraging excellence and identifying personal and professional development needs? Are supervisors provided with necessary orientation for conducting these performance reviews?

d. Does the organization’s performance management process include the potential for coaching employees in order to address performance issues/concerns?

e. Does the organization provide competitive compensation to employees? Do the Perley Rideau’s compensation practices provide internal equity amongst similar positions within the organization? Whenever there are significant changes to position responsibilities, are compensation rates reviewed and updated if necessary?

4. Workplaces That Work

a. Is the Perley Rideau committed to providing a safe work environment? Does it

promote a culture of safety by ensuring that employees are aware of their safety obligations, ensuring that safety rules and procedures are respected, correcting sub-standard working conditions, and maintaining equipment, etc.?

b. Is the Perley Rideau committed to supporting employee work/life balance? Does it regularly review workload to ensure that excessive workload is not required and support staff in maintaining a healthy balance?

c. Does the Perley Rideau work to ensure a work environment free of harassment? Does it take every reasonable measure to discourage harassment, investigate complaints of harassment, and handle related information in confidence, strictly limiting access to investigation findings?

d. Is the Perley Rideau committed to promoting an inclusive workplace? Does it proactively support diversity and inclusivity, consider alternative qualifications for selection, seek out and remove bias and discriminatory practices, and fully comply with the intent of human rights legislation? Does it accommodate religious



observation and/or disabilities satisfactorily? Do supervisors have the skills to support the development of an inclusive workplace?

e. Has the Perley Rideau established procedures and informed employees with regard to how to resolve conflicts within the organization?

5. Training, Learning and Development

a. Is every employee’s training and development needs reviewed at least annually with

plans established to address any gaps? b. During the development of the annual budget, is consideration given to including

appropriate resources to fund employee training and development?

6. HR Planning

a. Does the Perley Rideau have a process to review staffing needs resulting in a plan to address evolving requirements? Does it have a system to identify organizational goals or directions affecting staffing, trends or changes in social, economic, labour market or demographic conditions, legislative changes or technological developments which might impact on recruiting and retention?

b. Have critical positions in the organization been identified and succession plans established to address any potential gaps? Is talent nurtured and developed from within to move up in the organization?

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VOL III – GOVERNANCE / Part 4 – Stewardship: Guidance for Good Governance / Ch 6 – Stakeholder Relations (Board Approved 06Feb2014; Updated 11May2017) Page 1 of 22


Chapter 6

STAKEHOLDER RELATIONS

This chapter addresses the effective maintenance of constructive relationships with key stakeholders. It addresses the responsibilities of the Board (i.e. relationship building,

public communications and advocacy) as well as of individuals in meeting these expectations.

6.1 GENERAL

The Perley Rideau engages with a diverse community of internal and external stakeholders. Internally, these include residents and clients; their friends and families; staff and volunteers; etc. The external stakeholders include such groups as funding agencies; regulatory authorities; the Champlain Local Health Integration Network; other community health service providers and partners; advocacy groups and professional associations; contractors and suppliers, etc. In each case, their interests in the Perley Rideau are very specific to their needs; however, maintaining productive working relationships with all of them is essential to the Corporation fulfilling its mandate. The purpose of stakeholder relations is to assist the Corporation in achieving its goals and objectives, through the development and execution of programs designed to generate public understanding and support. To do this, the Board: Represents the organization positively to the community and its various

stakeholders; Fairly represents member and community perspectives to the Corporation; Ensures member and community input to planning; and Advocates for adequate resources to fulfill the organizational mandate. Stakeholder relations in the Perley Rideau context comprises three broad functions: Relationship-building - the pro-active art of developing and nurturing open lines

of communication with specific groups with whom the Perley Rideau must interact in course of fulfilling its mission;

Public Communications - keeping the public and the various stakeholder groups aware of “who we are and what we do”; and

Advocacy - the act of arguing in favour of a particular position or cause with a view to convincing a target audience of a need for change or for their support.



Each of these functions is described further below. 6.1.1 How We Want To Be Viewed By Others

Earning the trust and respect of the broader community is an ongoing task. It is painstakingly built year over year, but is ever fragile. Even a minor oversight can seriously compromise a particular stakeholder group’s confidence, necessitating years to rehabilitate the desired constructive relationship. In presenting itself to the community, the Board has established a set of principles defining how the Board wants to be viewed by the Perley Rideau’s stakeholders. In all its interactions with stakeholders, the Board should be guided by these principles. These are summarized at Appendix A to Chapter 1 of Part 2, providing a touchstone for evaluating the effectiveness of the Board in its stakeholder relations.

6.2 ACCOUNTABILITY1

Accountability is both about being held to account by external stakeholders, as well as about taking internal responsibility for corporate actions. The Board faces multiple, and sometimes competing, accountability demands: from numerous actors (upward, downward, internal), for varying purposes (finances, governance, performance, mission), and requiring differing levels of organizational response (compliance and strategic).

Much of today’s emphasis on accountability in Long-Term Care is on the compliance dimensions. This tends to skew organizational attention towards the interests of those who control critical resources. A predominant emphasis on compliance-driven accountability encourages health service providers to seek quick and tangible impacts, while neglecting longer-term strategic responses or riskier innovations that can address more systemic issues of social and political change.

The critical challenge for the Perley Rideau lies in finding a balance between upward accountability to the funders and regulatory authorities including the Ministry of Health and Long-Term Care, the Champlain Local Health Integration Network (LHIN) and Veterans Affairs Canada, while remaining true to its mission. At the same time, the Perley Rideau must remain accountable to the stakeholders of the community it serves. This balancing act requires:

Prioritizing among its diverse accountabilities. Rather than striving to be accountable to everyone for everything all the time, the Perley Rideau must decide on which accountabilities matter the most;

Integrating expectations regarding its multiple accountabilities (finances, governance, performance and mission) such that there is a common understanding (i.e. alignment) throughout the organization;

Adapting in the use of varied accountability mechanisms to suit the Perley Rideau’s 1 Adapted from “The Many Faces of Non-profit Accountability”, Alnoor Ebrahim, Harvard Business School, 2010



purposes. Accountability is not simply about compliance with laws or industry standards, but is more deeply connected to organizational purpose and public trust. New innovations are unlikely to lie in oversight and punishment, but in creative forms of adaptation and learning in order to solve pressing community problems.

In sustaining this balance as strategic priorities shift, some aspects of accountability may receive less than the ideal level of attention. The Board must be prepared to accept the inherent risks of this balancing act.

6.3 RESPONSIBILITIES

Given the diverse nature of the Perley Rideau’s many stakeholder groups, responsibility for establishing and nurturing effective relationships is diffused. On the one hand, the nature of the day-to-day work requires specialist subject matter expertise – especially in the domains of public relations and communications. On the other hand, the degree of openness and transparency required for effective relationships today means that responsibilities cannot be simply delegated to the staff experts. Maintaining effective relationships with stakeholders involves everyone who has occasion to interface with the public or any of the Perley Rideau’s diverse stakeholder groups. Nevertheless, following are some specific responsibilities.

6.3.1 Standards

Accreditation Canada has established standards for maintaining positive relationships with stakeholders. These standards are reproduced at Appendix A of Chapter 1 of this Part. They define a minimum with respect to expectations as to Board responsibilities and accountabilities for maintaining the confidence and respect of the larger community (see standard number 11 in particular).

6.3.2 The Chairman

Technically, the Chair is the only person authorized to speak for the Corporation, unless this has been specifically delegated to another Board member. As required, the Chair acts as the public and media spokesperson for the Board, subject to any direction provided by the Board. However, in practice, day-to-day the CEO provides the Perley Rideau’s public persona.

6.3.3 The CEO

The CEO is generally the most knowledgeable, up-to-date person on most issues and transactions involving the Perley Rideau, and is therefore responsible for interfacing with the various stakeholder groups on a day-to-day basis. As such, the Board relies on the CEO to: Build and maintain confidence in the character and integrity of the Perley Rideau,

with its clients, staff members, volunteers, collateral agencies, the public and



respective levels of government; Deal with client complaints in a manner that generally maintains positive

stakeholder relationships within the context of a professional service; Alert the Board to incidents, occurrences, or activities that may place clients, staff,

volunteers or the Perley Rideau at unusual risk, censure, criticism or public disapprobation; and

Subject to any communications policies or direction from the Board, routinely act as the Corporation's primary spokesperson with the media and the public.

6.3.4 Board Chair and CEO

From time to time, the Perley Rideau may require official presentations to be made, advocating on such issues as public funding for the Perley Rideau. Whereas the CEO may be required to interface with senior government officials seeking resolution to such issues, once the Board deems it necessary that the message be taken to elected authorities, the Board Chair (or a delegated Board member) will meet with those persons – usually accompanied by the CEO.

6.3.5 Stakeholder and Community Relations Committee

The Board has created a standing Committee to advise the Board with respect to building the credibility of the Perley Rideau, inspiring commitment and creating stakeholder support for the Perley Rideau. As an advisory Committee, the Stakeholder and Community Relations Committee supports the Board (and the CEO when asked) in the formulation of strategies and policies, and in evaluating the effectiveness of the Perley Rideau’s communications, advocacy and relationship-building initiatives. The Terms of Reference for the Stakeholder and Community Relations Committee are reproduced at Appendix E to Chapter 3 of Part 2.

6.3.6 Board Members

Although the Board relies on designated spokespersons to communicate official messages to specific stakeholders, every Board member has responsibilities for representing the Perley Rideau’s public face in the community. As part of the Perley Rideau’s routine outreach program, Board members are natural ambassadors for the Corporation in their daily interfaces with friends and neighbours, churches and service groups, recreational associations, etc. Board members may be asked to participate in a Perley Rideau speakers’ bureau. Not only should they be prepared to present facts about the Perley Rideau, its mission, vision and strategic plans and about the services offered, but they can serve as the eyes and ears of the Perley Rideau on acquiring community feedback. In addition, every Board member can be ever-vigilant for potential partners and allies for future initiatives, (including the recruitment of new Board members). From time to time,



Board members are also expected to provide a public presence, representing the Board at official events of the Perley Rideau. Notwithstanding these far-reaching, unstructured responsibilities, Board members must exercise great discretion when issues arise concerning official Board positions re public policy or advocacy work where official spokespersons have been designated.

6.4 BUILDING RELATIONSHIPS

Waiting until a problem has been identified before approaching a stakeholder to seek support from that stakeholder to underwrite or support their cause is equivalent to crisis management. A more successful approach to stakeholder relations requires that the Perley Rideau establish and nurture solid relationships, sometimes for many years before laying significant expectations upon them. The advantages of building strong, enduring relationships with various stakeholder groups include (inter alia):

Establishing due credibility and respect for the Perley Rideau’s performance in

enhancing the well-being of its residents and clients; Assessing the current situation from the stakeholders’ perspectives, including:

o The potential for their support on any given cause; o The potential barriers they may present to the Perley Rideau’s case;

Gaining access to stakeholders’ key decision-makers; Identifying potential allies, partners and possible game-breakers; etc. Failure to build and nurture political champions can seriously delay or arrest progress on issues of vital interest to the Perley Rideau’s mission. Although the Perley Rideau may be a big player in the eyes of some stakeholders, from the perspective of many others in the broader system of health care the Perley Rideau is a bit player. The relationship should acknowledge that the Perley Rideau is not (and cannot be) all things to all people all the time.

6.4.1 Stakeholder Management

Building and maintaining effective relationships with stakeholders requires strategic management. In essence, the following activities must be carefully orchestrated to serve the purposes of the Perley Rideau’s long-term objectives: Maintain an ongoing environmental scan of evolving health care issues pertinent to

the Perley Rideau’s mission; Identify key stakeholders in the community (including those most influential in

shaping public policy); Develop and nurture relationships with key stakeholders (the critical few) for the

long term by:



o Promoting integration and collaboration with key health service providers; and

o Seeking strategic alliances and partnerships; Promote media relations and public interest in the Perley Rideau; and Advocate on behalf of the Perley Rideau to:

o Increase public awareness of the Perley Rideau regarding its mission and vision;

o Argue for change regarding particular issues. 6.4.2 Identifying Key Stakeholders

The nature of the Perley Rideau’s expanding mission and strategic direction spins a complex web of diverse stakeholders (e.g. residents and clients, families and friends, staff and volunteers, governmental authorities and funding agencies, local health service providers, contractors and suppliers, local citizens and the media, etc.). But they are not all vital to the Perley Rideau’s interests all the time. As issues arise, the needs of particular interest groups should predominate the discussion. A list of some of the Perley Rideau’s stakeholders is at Appendix A to this Chapter. The challenge for the Board on any significant issue is to identify the truly key stakeholders and focus its attention on understanding their needs as expeditiously as possible. This process should identify not only the key decision makers, but also those persons or groups who have the most influence with the decision makers.

6.4.3 Political Relationships

Day-to-day, senior management develops the necessary working relationships for the conduct of operational matters. These relationships may involve senior officials and staffers up to the highest offices. However, if political engagement is required, the Board must get involved. To facilitate such political engagement, the Board must actively develop and maintain a positive relationship with a few of the key political representatives (i.e. the mayor and the local city councilors, the MPPs regardless of political persuasion, the Minister of Health and Long-Term Care, federal MPs and the Minister of Veterans Affairs). If an issue facing the Perley Rideau is big enough to require the attention of political representatives, the Board Chair (or his/her delegated representative) is required to deal directly with them; more often than not, this requires a team approach involving both the Chair and the CEO. Before proceeding, it is essential that the Chairman enjoys the support of a fully informed Board2.

2 It is recognized that from time to time the CEO may encounter face-to-face situations with key political representatives; great discretion is required in any effort to progress the Perley Rideau’s cause in such circumstances.



In an ideal world, a sound working relationship has already been established with the elected official’s aides and staff. For any meetings with political representatives, the Board should have developed a clear communications strategy (regarding the scope and message, the desired outcome, etc.) – whether the encounter is to plead for a cause or merely to lay groundwork in developing awareness of an evolving situation. In dealing with politicians, the Board should:

Build upon existing relationships with that office; Determine the best timing for any direct interaction; Maintain a consistent strategy when advocating for the Perley Rideau; Employ a team approach if practicable; Make the Perley Rideau’s case relevant to the politician’s broader interests and

agendas; Focus the agenda (i.e. avoid the temptation to overload the opportunity); Address any pushback and criticisms of a particular agenda; Leave a clear and concise message for a mutually desirable outcome; Identify key people at all levels and sides of government who should be aware of

the Perley Rideau’s case; and In making a specific request of a politician, note that strategically, potential success

is most likely early in the government’s tenure.

6.4.4 Relationship with the Media

Historically, the Perley Rideau has maintained a low profile with the media, responding only as necessary in rare times of crisis. However, the media can play a significant role in getting issues before the public and the attention of the pertinent political powers. Being seen by the community as leaders and innovators in providing progressive continuing health care not only influences governments but also donors and respective stakeholders. This is reflected in the Perley Rideau communications plan and is one of those activities that can engage the Board leadership with management in mutually beneficial activities. For these purposes, the communication strategy may include editorial board appearances on progressive approaches to the care of our elderly, Op-ed articles, speaking engagements at local, provincial and even national events involving particular associations.

6.4.5 Relationship with the Perley Rideau Foundation

The Perley and Rideau Veterans’ Health Centre Foundation’s support is fundamental to the Perley Rideau’s long-term viability – especially as the public purse tightens. Maintaining a mutually productive working relationship between the two boards is essential. This requires:

Mutual understanding of the respective roles of the two boards;



Full appreciation of the Perley Rideau’s: mandate, vision, mission, values, strategic directions, operating realities, successes and challenges;

Collaboration and coordination of strategic communications planning and messaging; and

Regular evaluation of the relationship’s effectiveness.

The two boards are signatory to a Memorandum of Understanding which outlines guiding principles for this relationship (available on the Perley Rideau website). The Health Centre and the Foundation are two separate corporate entities, sharing the same ultimate goal of improving the well-being our seniors. Two separate boards govern their day-to-day operations. Notwithstanding this legal separation of authority, from the public’s perspective, there is but one “Perley Rideau”. It is imperative that both entities “sing from the same song sheet”, that there be a unity in all Perley Rideau messaging to our external stakeholders. To that end: the two boards have agreed on a Joint Communications Strategy which outlines key messaging aligned with the Perley Rideau’s strategic directions, implementation strategies and vehicles, and measurements of success. It is reproduced at Appendix B to this Chapter. In addition, it has been the practice for each board to have representation on the other’s working committee responsible for communications.

6.5 PUBLIC COMMUNICATIONS3

Good communication can greatly enhance the effectiveness of any organization. The Perley Rideau is one of the largest long-term care homes in the province and is significantly expanding the scope of services offered, thereby creating a “seniors’ village”. It needs to tell people about the work it does, the services it offers and its need for financial and volunteer support. It must also be prepared to answer questions from corporate members, the media, the public and stakeholders. Such communications contribute to the public image and reputation of the Perley Rideau. It is important that individual Directors, volunteers and staff members know when it is appropriate for them to provide information and answer questions, and when they should refer the communicating to designated spokespersons. Successful organizations are effective in balancing openness and caution in their communications policy. Generally, they encourage Directors, volunteers and staff to promote the organization, its programs and upcoming events — information that is usually available in brochures, newsletters and the website. Fact sheets and suggested answers can be valuable for anyone involved in communications. For information that is more technical, complex or sensitive it is important to coordinate

3 Adapted from the Chartered Accountants of Canada publication, “20 Questions Directors of Not-for-profit Organizations Should Ask about Governance” © 2006.



and clarify roles and responsibilities by defining who can speak and on what, and by providing training for spokespersons. This is particularly vital in times of crisis. Crisis planning should identify a specific individual who will present information and handle questions from members, the public and the news media, and inform staff, volunteers and Directors where questions can be referred.

6.5.1 Who Speaks for the Perley Rideau?

Authority to speak on behalf of the Corporation rests with the Chair and/or CEO. This authority may be delegated by either of them to others in the Perley Rideau within their special fields of competence or knowledge. In general:

The Chair will represent the Corporation on matters of Board policy and will meet

with elected officials; The CEO will represent the Corporation on operational issues, and will meet with

senior staff members of government and the media; Either may represent the Corporation on issues related to advocacy on behalf of the

mandate of the Perley Rideau; Any major statements of an advocacy nature must be consistent with the general

parameters of Board-approved policies or positions. This is not intended to inhibit private expression of personal or professional opinions, but care should be taken by individual Directors to distinguish such opinions from positions of the Corporation. They are also expected to avoid public statements that might undercut or obscure the messages conveyed by the organization’s approved spokespersons. Directors are expected to be particularly judicious about this since their public profile may deflect attention away from messages conveyed by the official spokespersons and generate confusion or controversy.

6.5.2 Public Accountability

As stated earlier, the Perley Rideau faces the challenge of balancing its accountability upwards (reporting on regulatory compliance and fiduciary aspects) against its accountability laterally and downwards to its various stakeholders of the broader community. Management is accountable for submitting specific operational reports to various authorities on a continuing basis. The reporting requirements are clearly spelled out and include reports for particular data and information in clinical, personnel, financial, and other areas. However, public accountability also includes telling all stakeholders openly and honestly what the Perley Rideau is about, what it has achieved and how it has managed its resources. Annual Meeting. In a general way, this is achieved through the presentation of the Chairman’s annual report at the Annual Meeting of the Corporation. Typically, the Treasurer also presents the annual financial statement at this meeting. It carries the



authority of having been approved by the Corporation’s independent auditor. Public Communications. In a less formal manner, the Perley Rideau keeps the community informed of ongoing activities, events and major projects through its Newsletter, Between Us, and its more formal Reports to the Community. Web Site. The Perley Rideau also posts information about the organization and its activities, including its governance structure and policies, on-line. Stakeholder Associations. The Perley Rideau meets with specific stakeholder groups on a regular basis (such as resident councils, the local community, veterans’ associations, etc.) to update them on specific developments and to hear their concerns. Public Engagement. Senior managers and Board members are increasingly participating in public fora on pertinent issues, putting a face on the Perley Rideau, sharing experience, and learning from others. Through such dialogue they can build relationships, quietly advocate for change, identify potential allies, and identify barriers to fulfilling the Corporation’s vision. As well, the Perley Rideau provides an annual report to the community.

6.6 ADVOCACY

Advocacy is the act of arguing in favour of something, such as a particular cause, idea or support. The purpose of advocacy is to bring about change, usually with respect to particular policies or laws. However advocacy can also be used to raise public awareness and understanding of an issue. Advocacy can focus at different levels from the local community to a provincial or even a national level. It can encompass a range of activities from one-on-one meetings with key officials to wide public communications campaigns. Preparing for advocacy work can be painstaking in terms of defining the optimal communication strategy and refining the appropriate message for the target population. Its execution can be both extensive and expensive, and the outcome may be failure to convince. The Board’s role legitimately includes being a political advocate for the Perley Rideau’s interests; its success will be dependent on how effective it has been in creating and nurturing effective relationships with those politicians who can influence the Perley Rideau’s outcomes. This requires careful strategic planning. To guide the Board with respect to undertaking advocacy work, it has established a separate policy (a copy of which is appended to Volume IV). According to this policy, the focus of the Perley Rideau’s advocacy work will be:

“To realize its vision, the Perley Rideau will pursue a strategy of leadership and be an advocate for change in health care, particularly in the long-term care sector. It



will strive to be a credible, nationally recognized leader in dementia care and a highly valued partner within health care and in particular long-term care.”

Advocacy can be critical in terms of the Perley Rideau’s ability to: Improve community awareness of the evolving situation re the fulfillment of the

Perley Rideau’s mission; Achieve alignment between community expectations and the Perley Rideau’s

vision; Garner support of key stakeholders and potential partners on particular issues.

6.6.1 AdvantAge Ontario (formerly the Ontario Association of Non-Profit Homes and Services for Seniors - OANHSS) AdvantAge Ontario (formerly OANHSS) is a provincial, membership-based organization that has represented not-for-profit providers of long-term care, services and housing for seniors for over 90 years. This association does formally lobby government – framing issues facing today’s seniors and arguing for change in governmental support for its membership. The CEO of the Perley Rideau has been an active participant in OANHSS governance for many years, thereby ensuring that the Perley Rideau’s perspective is shared with key players in this sector of health care. As a consequence, the CEO is able to keep the Board apprised of the political landscape and the evolving issues impacting on the Perley Rideau’s strategic plans.

6.7 STAKEHOLDER RELATIONS REVIEW

As in all other aspects of Board governance, periodic reviews of organizational performance are essential for the Board to maintain an informed basis for strategic planning and decision-making. Accreditation Canada has laid down standards for health service providers to evaluate their effectiveness in maintaining sound relationships with their diverse stakeholders. These are appended in Appendix A of Chapter 1 of this Part. Standards of specific relevance include those found under section 11. A further review checklist is provided at Appendix C to guide the Board and the Stakeholder and Community Relations Committee in routinely assessing the effectiveness of their efforts to connect constructively with those who have the potential to assist (or hinder) the achievement of the Perley Rideau’s strategic objectives and the fulfillment of its vision. In this regard, the Board must recognize the difference between: Reviewing the effectiveness of specific communications programs (e.g. marketing

particular services) which is a management function; and



Evaluating the strategic effectiveness of the Perley Rideau’s efforts to build and sustain essential relations and to communicate with its stakeholders (which is a Board function).

The wide variations in needs of the Perley Rideau’s diverse stakeholder groups can result in wide differences in the effectiveness of the organization’s relationship-building and communications efforts. For example, the requirements for fostering strong relationships with key politicians differs from those required for effective relationships with senior government officials, staff relations, or media relations. One size will not fit all. Therefore the objectives, scope and nature of auditing relationships for each will vary. From time to time situations may arise that warrant professional expertise to conduct a formal audit of the effectiveness of the Perley Rideau’s communications with its stakeholders. When any of the following conditions develop, consideration should be given to such a formal audit:

The Perley Rideau is planning a major change in strategic direction (such as a

merger, the type or volume of programs and services being offered, etc.); A change in the CEO; The Perley Rideau is frequently caught off-guard by developing issues; The Perley Rideau finds itself frequently on the defensive with various stakeholder

groups; The Perley Rideau’s position on controversial issues continues to be

misunderstood; The media are not interested in community issues related to the Perley Rideau and

its mission; Perley Rideau communications products are not consistently well received by key

stakeholder groups; A key stakeholder group is challenging the relevance and effectiveness of the

Perley Rideau’s contribution to the community.

**************




SAMPLE OF PERLEY RIDEAU STAKEHOLDERS

Political

Ontario Minister of Health and Long-Term Care Local MLAs Federal Minister of Veterans’ Affairs City of Ottawa Mayor and local Councillors

Government

Ministry of Health and Long-Term Care o Champlain LHIN

Veterans Affairs Canada City of Ottawa

Perley Rideau “Family”

Residents and clients Family and friends Staff and volunteers In-house service providers Foundation

Hospitals

Ottawa Hospital Bruyère Royal Ottawa

Health Care Agencies

Alzheimer’s Society Carefor Champlain Dementia Network Community Care Access Centre South East Ottawa Community Health Centre

Others

OANHSS (Ontario Association of Non-profit Homes and Services for Seniors) Media Unions Canadian Legion




Joint Communications Strategy

The Perley and Rideau Veterans’ Health Centre / The Perley and Rideau Veterans’ Health Centre Foundation

This strategy provides direction for the development of communications plans. The Goal Increase the profile of the Perley Rideau:

By letting people know who we are and what we do - how we satisfy seniors’ needs today and how we intend to improve access to care, accommodations and wellness services;

As a champion of dignified, independent and healthy living with a unique responsibility for caring for both veteran and community residents;

By sharing our knowledge and accomplishments as a recognized leader in seniors’ care; and

As an educational gateway for families and seniors seeking information on healthy living and managing chronic and age related conditions and diseases, especially dementia.

The Purpose Our success in raising the profile of the Perley Rideau will help make the case for:

Attracting and retaining caring health care workers and volunteers; Provincial funding and support for Ontario’s Aging at Home, and the Champlain LHIN’s

health living programs, and the proposed community health satellite on site; Fair and adequate funding for long-term care, Assisted Living Program supportive

housing, and outreach services; Federal funding for veterans care; Increased charitable donations and planned giving; Changes to public policy in support of seniors; Attracting on-site commercial investments; Community, interagency and academic partnerships; and Funding for applied research, education and training in gerontology.

The intended audiences and stakeholders Our messages will be targeted depending on our audiences and stakeholders. They include:

Perley Rideau residents and their families; Perley Rideau assisted living program residents;



Perley Rideau staff and volunteers; Funders and donors of the Perley Rideau; Perley Rideau’s suppliers of goods and services; Elected officials and the staff at the municipal, provincial and federal levels such as the

City of Ottawa, the MOHLTC, Champlain LHIN, CCAC and Veterans Affairs Canada; Accreditation Canada for the purposes of advocating standards and reporting; The medical community and professional associations; Neighboring communities of the Perley Rideau; Learning institutions and their health care students; The Royal Canadian Legion and veterans’ associations; The Canadian Forces senior leadership; The public: prospective residents, caregivers, adult children, decision influencers; and The media.

Positioning the Health Centre The Perley Rideau is aware that Veterans Affairs Canada (VAC) has adopted a strategy to accommodate War Service Veterans in priority access beds in vicinities as close as possible to the homes of the veterans, rather in centralized facilities such as the Perley Rideau. We also recognize that in the near future, the involvement of VAC in the Perley Rideau will diminish if not end as there will be no War Service Veterans alive. Not with standing these realities, the Perley Rideau recognizes that we have a moral obligation to honour all veterans and their families. In addition, we will continue to support those from the local community with our current programs and new programs to be developed in the future to help seniors live a life that is as healthy and as independent as can be. To this end, the Perley Rideau has developed a 15 year vision of how we will address the evolving needs of seniors as documented in “Creating a Seniors Village”. In addition, we will continue to support those from the local community with our current programs and new programs to be developed in the future to help seniors live a life as healthy and independent as can be. To this end, the Perley Rideau has developed a 15 year vision of how we will address the evolving needs of seniors as documented in "creating a Seniors Village". The Perley Rideau’s Seniors Village is based on four pillars. These pillars summarized below set the direction for the Perley Rideau’s joint communications strategy – as we engage and mobilize members of the community by making a reasonable and appropriate investment in time and effort:

A. The Perley Rideau is Committed to Excellence in Resident Care and Service:

The Perley Rideau is foremost the home of its residents. Their well-being is paramount.



The Perley Rideau offers a wide range of programs and services for seniors to help them have lives that are as healthy and productive as possible. These programs and services are available to veterans and the general public.

Every resident of the Perley Rideau will experience exemplary care and services in an environment of dignity, safety and best practices.

The Perley Rideau is a Seniors’ Village where residents experience a social environment which meets their needs.

The Perley Rideau honours its veteran residents and their contribution to Canada. The annex to this strategy document is a summary of two joint Health Centre/Foundation round tables on "Veterans" issues. Some parts of this summary may be useful in communications/marketing work that will flow from this strategy.

The Perley Rideau is attractive to and accommodating of residents from diverse cultural backgrounds.

B. The Perley Rideau is committed to sustainability

The Perley Rideau recognizes that it must be transparent, accountable and sustainable - providing value for every dollar entrusted to it from public or private sources.

The Perley Rideau is a fiscally responsible organization committed to a sustainable business model.

The Perley Rideau continually pursues organizational efficiency including making investments leading to greater efficiencies.

The Perley Rideau continually pursues opportunities to increase funding available through increasing business revenue.

The Perley Rideau values its charitable donors and is a prudent steward of their contributions.

The Perley Rideau will continue to advocate to government for fair and reasonable funding.

The Perley Rideau will ensure it provides high value for money and is a place where the government wants to invest.

C. The Perley Rideau Maintains and Attracts a Quality Work Force

The Perley Rideau has a knowledgeable, compassionate, culturally-diverse and dedicated workforce working in a caring environment.

The Perley Rideau’s employees are its greatest strength and the reason the Perley Rideau is recognized as a local leader in dementia and long-term care.

The Perley Rideau is committed to helping employees reach their personal best through staff training and development opportunities.

The Perley Rideau provides a quality working environment, wellbeing programs and staff recognition.

The Perley Rideau appreciates its volunteers – they are the tireless advocate who enrich the lives of our seniors by providing the gifts of time, talent and compassion.



The Perley Rideau recognizes that its staff is essential to moving forward and works with the staff and union to achieve its mission and strategic plan.

D. The Perley Rideau is a Leader and Advocate for Change

Perley Rideau aims to build its reputation as a respected and recognized leader in dementia care and trusted partner within health care and particularly long term care.

The Perley Rideau will communicate with its stakeholders to strengthen partnerships and build support for its vision, goals and objectives.

The Perley Rideau recognizes the importance of active support of the community and will maintain an open relationship with it in all respects.

The Perley Rideau recognizes the importance of alliances and partnerships in the clinical, training and eventually research domains. Particular foci include dementia, convalescent care and, in the future, sub-acute care.

The Perley Rideau will continue to participate in high level advocacy for quality homes, care and services for seniors.

From Strategy to Results

Guided by the Memorandum of Understanding between the Health Centre and the Foundation, implementing the joint communication strategy will require unity between the two boards and their staffs with careful coordination and targeting of messages, to ensure that the right messages reach target audiences at the right time using the right frequency and channels. Implementation The Health Centre Stakeholder Liaison Committee has primary responsibility for setting direction and oversight of the Health Centre management of communications activities. Such activities are to be consistent with this joint communications strategy. The Health Centre Special Committee on Assisted Living has primary responsibility for setting direction and oversight of the Health Centre management of communications activities related to the Assisted Living Program including the marketing of this program. Such activities are to be consistent with this joint communications strategy. The Foundation Communications Committee has primary responsibility for setting direction and oversight of the Foundation management of communications activities related to fund raising, including the capital campaign associated with the Assisted Living Program. Such activities are to be consistent with this joint communications strategy. The Health Centre Board and the Foundation Board are committed to providing management with the resources necessary to develop and implement communication plans consistent with this strategy to the extent possible.



This long-term joint communication strategy will assist with the comprehensive transformation of the Perley Rideau to a Seniors Village. The foundation for the future will take place in the first two years. While recognizing that the Health Centre and Foundation managements are responsible for developing and then implementing their respective plans, it is recommended that priority be given to the following:

Allocate a dedicated budget for communications; Create and improve communication tools; Develop a marketing strategy for the Assisted Living Program and other commercial

operations; Assist with the development of partnerships and support groups in the community; Conduct research and/or utilize in-house research to compile an information base for

targeting and messaging; Showcase how the Perley Rideau is performing and how it is making an impact on

seniors’ quality of life (e.g. introducing staff, using testimonials and recognizing public funders and private donors);

Communicate the ways the Perley Rideau is developing the body of knowledge that will support its goal of becoming a centre of excellence in geriatric and dementia care; and

Communicate the Human Resource strategy that supports a transformed Perley Rideau.

Communication Vehicles The communication vehicles to be employed to implement this joint strategy will be selected as part of the development of the Health Centre and Foundation communication plans. It is anticipated that the following types of communication vehicles will be employed in these plans.

Report to the community/Annual report; On-line marketing: web site, and social media tools including Facebook, Twitter,

LinkedIn; Resident/client/staff/volunteer/peer interactions, transactions and contacts. Outreach programs such as support services, healthy living, and workshops; Public relations: Open houses and tours, speakers bureau; Fundraising events; Media coverage and relationship building; Newsletters: Between Us (external)and Between Us Briefly (internal); Brochures and pamphlets; Assisted Living Program marketing; Traditional advertising – television, radio, newspapers; Meetings: annual meetings, Veterans Liaison Committee; Family and Friends Council,

community meetings; Corporate identity and branding.

Measuring Success The success of this joint communication strategy will be judged by its ability to increase its



visibility and viability in the community. It is anticipated that the communication plans to be developed under this joint strategy will incorporate appropriate tracking mechanisms to evaluate their effectives such as those outlined below.

Brand recognition throughout the Champlain LHIN: i.e. the Perley Rideau’s image that comes to mind;

Recruitment and retention of staff; Recruitment of volunteers; Occupancy rates; Participation Rates, including outreach services, support groups and workshops, open

houses and tours; Profitability and volume of commercial endeavours; Requests for information; On-line marketing; Web page views/requests for information; Results of satisfaction surveys: comment cards; Media monitoring; Fundraising growth; Quality of partnerships and alliances; Level of public funding support; and Level of non-public funding support.

____________________________ ____________________________ Chairman Chairman Health Centre Board Foundation Board Date: ______________________ Date: _______________________



Appendix C


STAKEHOLDER RELATIONS REVIEW CHECKLIST 1. Pursuant to Accreditation Canada’s Standards for Sustainable Governance, the Board:

a. Strives to maintain a positive working relationship with the Perley Rideau’s diverse stakeholder groups; and

b. Demonstrates accountability to the Perley Rideau’s stakeholders.

2. The Board and management together are engaged in a process of building and nurturing long-term relationships with such stakeholder groups, key decision makers and those of critical influence as: a. Politicians; b. Senior government officials; c. Potential partners within the LHIN; and d. The media.

3. The Board considers external and internal communications to be a critical element for achieving its strategic objectives and fulfilling the Perley Rideau’s vision.

4. The Board is satisfied that: a. Management understands and supports communications as an integral part of the

Perley Rideau’s viability and success; b. Management’s communications policy reflects the Board’s philosophy of openness

and transparency in its relationships with stakeholders; c. Management is following a strategic, coherent and comprehensive communications

plan; d. Management of the Health Centre and the Foundation are collaborating effectively

in supporting the Perley Rideau’s vision, mission and strategic directions; e. Sufficient resources are being allocated to the maintenance of stakeholder relations

and the planning and delivery of an effective communications program; f. Communications is an integral aspect of every major project, program and strategy; g. Communications is not seen as an isolated or specialty function, rather staff at all

levels can help carry the message. 5. The Perley Rideau’s communications practices systematically:

a. Align its communications vision with its overall vision and mission; b. Assess the current environment and competition, taking contextual variables into

account in communications planning; c. Define specific, measureable communications goals and outcomes; d. Target selected stakeholder groups including key decision makers and those with

influence on priority issues;



e. Outline specific, clear and persuasive messages, including the desired action and outcomes;

f. Identify the most appropriate messengers and communications medium for the targeted audiences.

6. In implementing the Perley Rideau’s communications plan, the Board is satisfied that:

a. Attractive materials and messaging are appealing to the key stakeholder groups; b. Messengers are appropriately prepared to carry key messages and are achieving

consistent delivery; c. Linkages with particular stakeholders are helping to carry the message; d. As necessary, the message is carried through multiple outlets to reinforce its

impact; e. Management is regularly monitoring and evaluating the effectiveness of the

communication process, adjusting as necessary, and reporting o the Board accordingly.

7. The Perley Rideau is striving for continuous improvement in its stakeholder relations

initiatives by: a. Regularly conducting a SWOT4 analysis of the its internal and external

relationships as well as its communications initiatives; b. Systematically capturing feedback using a variety of methods; c. Analyzing feedback data; d. Adjusting the message and/or delivery methods; e. Reallocating resources, if necessary; f. Validating the communications strategy.

8. The Board is satisfied that: a. The Perley Rideau has established and is maintaining effective relationships with

those decision-makers key to the fulfillment of the Perley Rideau’s vision and the achievement of its mission; and

b. These decision makers understand the Perley Rideau’s perspective on current issues.

4 SWOT: Strengths, Weaknesses, Opportunities and Threats.


VOL III – GOVERNANCE / Part 4 – Stewardship: Guidance for Good Governance / Ch 7 – Enterprise Risk Management (Board Approved 06Feb2014; Revised 16May2017) Page 1 of 8


Chapter 7

ENTERPRISE RISK MANAGEMENT1

This chapter outlines the Board’s role in managing the risk facing the Perley Rideau. It provides guidance for preparing for risk, preventing risk, and protecting against risks,

and discusses risk acceptability and risk tolerance.

7.1 GENERAL

Risk accompanies every human endeavor, both personal and organizational. Managing risk is an integral part of good governance. Maintenance of the viability and integrity of the Perley Rideau is a core responsibility of the Board. Successful organizations have effective processes for proactively identifying risks before any adverse consequences occur and for managing those risks to reduce or eliminate them. In spite of the best strategic planning and organizational effort, things that can go wrong sometimes do, and reality deviates from assumptions and intentions. Over time systematic risk management practices lead to a risk-aware culture across the organization, where risk becomes a key consideration in everything the Board, staff and volunteers do.

7.1.1 Risk Management Standards

As part of its quest to reduce the risks to the organizations and to promote ongoing quality improvement in the management of Canada’s health service providers, Accreditation Canada has prescribed a set of standards. These are reproduced at Appendix A to Chapter 1 of this Part (see Standard 12).

7.1.2 Board’s Role in Risk Management

The Board has overall accountability for risk management of the Perley Rideau. Its role includes: Promoting an awareness of the need to manage risks; Identifying and assessing the risks that could affect the achievement of the Perley

Rideau’s strategy;

1 This chapter draws upon material from the Ontario Hospital Association’s “Guide to Good Governance” Chapter 8.



Overseeing the establishment of a coherent framework of policies and processes for managing risk;

Learning from the Perley Rideau’s experience in managing its risks. The Board delegates to the CEO most of the detailed aspects of identifying, assessing and managing the day-to-day operational risks – subject to this Board policy. In so doing, the Board must be satisfied that the CEO has measures in place to assure prudent management of risks.

7.2 ENTERPRISE RISK MANAGEMENT

The process of ensuring systematic risk assessment across the organization or enterprise is generally referred to as enterprise risk management or corporate risk management. Effective enterprise risk management involves assessing threats in a way that is compatible with the Perley Rideau’s values, strategic objectives and risk tolerance, and establishing a coherent framework of policies and processes for the effective management of risk across the entire enterprise. The Board requires Directors who are comfortable in overseeing and challenging management in the establishment of a risk-aware operating culture across the organization and finding the right balance between opportunity and unacceptable risk.

7.2.1 Forms of Risk Risk at the Perley Rideau is anything that could affect the corporation’s ability to fulfill its mission, meet its strategic objectives and preserve its reputation. Some potential areas of risk for the Perley Rideau include:

Governance risk: the risk of ineffective oversight, strategic thinking or decision-

making due to issues with board composition, competence or capacity. Strategic risk: the risk of inappropriate or unrealistic goals and objectives or of

keeping the organization strong and relevant, or the risk of losing mission relevance, failing to respond effectively to changing economic or demographic circumstances, losing the confidence of funding sources and community support, etc.

Safety/Security risk: the risk that residents, tenants, visitors or staff will suffer serious injury or loss of life or that their safety and security will be compromised due to lack of planning, inappropriate or ineffective standards or procedures, negligence, etc.

Legal and Regulatory: the risk that the Perley Rideau will fail to comply with applicable legislation or regulatory requirements, such as resident care standards, remittance of payroll deductions, violations of privacy laws, etc.

Financial risk: the risk that the Perley Rideau will be unable to operate within its financial resources due to such factors as poor fiscal management, inappropriate financial decisions based on inaccurate information or assumptions, fraud or embezzlement, etc.



Human resource risk: the risk that the Perley Rideau is unable to attract or retain staff with appropriate skill mix.

Operational risk: the risk of unsatisfactory care or service delivery. Infrastructure risk: the risk that the physical plant, IT systems or other facilities

will fail to meet the needs of residents, tenants, staff or other clients. Partnership: the risk that Perley Rideau’s partners will be unable to meet their

commitments to the Health Centre.

As a result of risks not being effectively managed or mitigated a number of unfavourable outcomes or consequences could occur: Reputational – losing goodwill, status in the community, the ability to raise funds,

or appeal to prospective employees and volunteers; Legal – being subject to legal action; Financial – incurring crippling financial costs or liabilities; Personal – causing harm to residents, tenants, visitors, staff or volunteers Operational – impaired service delivery or deterioration of buildings and other

assets. 7.2.2 Phases of Risk Management

One framework for approaching enterprise risk management has three interrelated components: Preparation involves identifying and assessing potential risks, as well as

determining how best to mitigate each risk. Effective preparation includes: o Periodically conducting comprehensive risk identification processes in all

functional areas of the organization (e.g. clinical, operational, financial, human resources, external relations, plant and facilities, etc.);

o Assessing each identified risk, evaluating both the potential consequences of the risk arising as well as the probability of occurrence; and

o Selecting the most appropriate measures to reduce or eliminate the risk. Prevention of risks increases the likelihood of achieving the strategic and operating

plans. It involves such activities as: o Providing policies and processes that are designed to minimize or avoid risks; o Performance monitoring to facilitate corrective action by management; o Ensuring staff competence; o Building an organizational culture that promotes achieving results as well as

identification and amelioration of risks; and o Contingency planning to diminish the impact of potential risks and surprise

events. This includes emergency preparedness for disasters and infection outbreaks.

Protection includes managing the effects of risks on the organization. Once the

risks have been identified and assessed, decisions are required as to how best to



mitigate or eliminate those posing the largest threats. Six potential strategies follow: o Exposure avoidance. Dependent on the Board’s risk tolerance, the simplest

strategy is to just not do whatever is posing unacceptable risk. However, risk-averse boards will miss opportunities for organizational improvement. Part of the risk assessment process must include consideration of the downside if the organization does nothing. Before abandoning good ideas, the Board should look for activities that will control the high risks to an acceptable degree.

o Loss reduction. Well-developed procedures with checks and balances can help detect and reduce the likelihood and/or severity of particular risks. The medical field follows well defined procedures to reduce risks to patients and staff. Similarly, accountants use internal controls to protect assets and keep accurate records.

o Segregation of exposure. Action is taken to isolate the effects of the risk, perhaps by building redundancy into the system or ensuring viable “off ramps” in the decision making process with clearly defined criteria for their use.

o Recovery measures. In some operating systems it is possible to employ procedures for trapping risks, errors or failures, before the problem compounds into a more serious problem.

o Transferring risk. The risk is shared with somebody else, perhaps a partner for the initiative. Buying insurance is one way of transferring risk – especially for such perils as fire, theft and liability. Contractual relationships with organizations with particular expertise can help reduce some risks.

o Accepting risk. Providing that the risk is unlikely to materialize or would not cause unacceptable harm to the organization, it may make more sense to accept but monitor the risk.

7.2.3 Risk Acceptability

The implications of accepting the risk and the proposed risk management strategy would be based on such factors as:

Corporate: Are the potential consequences of the risk compatible with the Perley

Rideau’s vision, values and policies? Affordability: Does the nature of the risk defy cost-effective resolution? Legal: Is the risk in conformance with current legislation and regulations? Cultural: How will the Perley Rideau’s staff and stakeholders view this risk? Market: Will the Perley Rideau’s competitiveness and well-being be compromised

by not reducing or eliminating this risk? Political: Will there be a political price to pay for accepting this risk? Public: How influential will the media or special interest groups be in affecting the

Perley Rideau’s stakeholders regarding this risk?



7.2.4 Risk Tolerance

Risk acceptance is directly related to the organization’s risk tolerance. No viable corporation can be completely risk averse; nor will it thrive in the long run with a “nothing ventured, nothing gained” approach to risk. The Board must find the optimum balance between risk and opportunity. Defining and prescribing acceptable levels of risk for the Board (i.e. its “risk tolerance”) depends on the situation. Following are some considerations for determining the Perley Rideau’s risk tolerance:

Its “capacity for risk”, including the strength of its finances, its donor support,

reputation and credibility, the experience and competence of its staff, the collective wisdom of the Board and senior management, etc.

The reliability of its underlying assumptions; The amount of money that the Perley Rideau is prepared to lose if a particular

initiative fails; The potential risk to the Perley Rideau’s reputation if a strategy or project is not

successful; The limits to the authority of the CEO beyond which the Board will not go; The quality and type of the information deemed essential by the Board before

accepting the risk; for example: o Quantitative analysis? o Integrity of the business case? o Alternative courses of action? o Outside expert opinions? o Worst case scenarios?

At the end of the day, risk tolerance is all about “comfort zone”. Today’s Board may have a completely different comfort zone than tomorrow’s.

7.2.5 Board Behaviour

Relying on the oversight of management is not sufficient to achieve sound enterprise risk management. The Board must ensure that its own behaviour and processes are in line with respect to risk. The Board sets the tone for the Corporation’s culture of risk awareness. It must lead by example. Knowledge and Ability of Directors. The first requirement is that Board members and adjunct advisors know their jobs and have the skills to perform them. This includes: Recruiting members for the skills and knowledge required on the Board and its

Committees (with consideration given to continuity and turnover);



Ensuring that orientation is in place so that each Board and Committee member understands the nature of the Board’s role and the Committees’ roles with respect to risk management;

Periodic review of the Perley Rideau’s By-Laws and Directives; Requiring financial literacy of those members on Committees addressing financial

and audit matters.

Organizing for Risk Management. The Board does not require a separate committee for enterprise risk management. Risks may overlap in many areas; for example clinical risks revealed in the Quality of Life and Safety Committee may have collateral impact on relationships with the regulatory authority and the community. Similarly funding issues may impact on relations with the province, bankers and the community. Thus, risk management is a normal part of the Perley Rideau operating culture. That is: everyone is in a position to identify risks and refer them to an appropriate level of management. At the Board level, several Committees are involved in consideration of particular major risks that inherently threaten the viability of the organization. For example:

Quality of Life and Safety Committee oversees quality assurance and management

programs relative to resident and client liability, infection control and contingencies;

Stakeholder and Community Relations Committee evaluates the potential impact of major risks on goodwill and community relations including the relationship with funders and donors, other partners and stakeholders;

Audit and Risk Management Committee oversees evolving financial conditions including the adequacy of the budget, financial efficiency, sensitivity to revenue shortfalls, etc. It also assesses insurance and financial needs; and it ensures that the corporate risk profile is reviewed regularly and corporate risks are appropriately managed;

Governance and Planning Committee reviews and assesses the effectiveness of the Board’s and management’s risk management policies and procedures across the entire “enterprise”; it identifies and assesses the corporate risks to the Perley Rideau arising from particular strategic directions or programs being considered and ensures that the corporate risk profile is considered in the annual strategic review and update.

7.2.6 Reviewing Enterprise Risk Management

In addition to Accreditation Canada’s Standards for Sustainable Governance, Appendix A to this Chapter includes a Review Checklist for assessing the fulfillment of the Board’s responsibilities with risk to exercising effective Enterprise Risk Management.

**************




REVIEW CHECKLIST FOR RISK MANAGEMENT

Governance

The By-Laws and all other documents essential to good governance are current and practicable, and that actual governance practices are compliant.

The Board possesses collectively the requisite skills, knowledge and experience for their duties.

The Board receives adequate and appropriate information for the performance of its duties (including perspectives beyond those of management when necessary).

The Perley Rideau’s performance monitoring system includes monitoring and evaluation of its enterprise risk management policies and processes.

The Board has provided a written job description for the CEO and has specifically defined the limits of the CEO’s authority.

Risk Aware Culture

Risk awareness is an integral element of the corporate culture in strategic planning as

well as in day-to-day decision-making in governance, management and operations. The Perley Rideau’s philosophy and values include codes of conduct with protection

for whistle blowers. Staff receive formal training with respect to the Perley Rideau’s risk management

philosophy and processes. Operating practices throughout the organization comply with:

o Statutory and regulatory requirements; and o Perley Rideau policies and its ethical framework.

Risk Management Processes

Management follows policies and procedures for the systematic identification,

assessment and mitigation of risks across the Perley Rideau enterprise. Resources are sufficient to minimize risk to employees, volunteers and beneficiaries

of services provided by the Perley Rideau. A sound quality management program is in effect to protect the Perley Rideau from

deficiencies in resident or client care, including a safety management system. The Perley Rideau’s risk management programs and activities are monitored and

evaluated on an on-going basis. Management reports at least annually to the Board on significant corporate or

enterprise risks (and opportunities) facing the Board and management’s proposed action for managing these.



The Board regularly receives risk reports from management and annually reviews and discusses the corporate risk profile to ensure all risks have been appropriately identified, assessed and managed.

The Board’s annual strategic assessment includes an assessment of the corporate risks confronting the Perley Rideau.

Financial Risk Management

Sound financial management policies and processes are in effect including:

Budget and capital planning processes to protect the Perley Rideau against predictable risks to its sustainability;

Any defined financial reserves deemed necessary; An effective regime of internal financial controls for approving expenditures; An investment policy to protect Perley Rideau investments; A policy framework for contracting for the procurement and delivery of goods and

services; and Adequate insurance provisions are in place to protect the organization and the Board

from potential liabilities.

Other Resource Risk Management

A coherent framework of policies and procedures are in place for:

The effective utilization of the Perley Rideau’s human capital; The development, maintenance and operation of the Perley Rideau’s informatics

services that provide accurate, secure information that is available when needed; The sustainability of the Perley Rideau’s plant and for the maintenance and

replacement of its other physical assets; and The ongoing maintenance of effective working relationships with stakeholders,

preserving the reputation of the Perley Rideau as a trusted and respected partner.


VOL III – GOVERNANCE / Part 4 – Stewardship: Guidance for Good Governance / Ch 8 – Performance Mgmt. (Board Approved 06Feb2014, Rev. 04June2015, Updated 07Sept2017) Page 1 of 12


Chapter 8

PERFORMANCE MANAGEMENT1

This chapter identifies key areas of Board responsibility for performance monitoring and provides guidance in the use of performance monitoring reports.

8.1 GENERAL

One of the Board's responsibilities is to oversee the performance of the Perley Rideau, especially in terms of quality of care and services, financial condition and progress on attaining its strategic goals. As a normal part of performance management today, the Perley Rideau establishes objectives and reports performance results on a monthly, quarterly and annual basis, and an assessment is made as to whether a correction is required based on that performance. This process is generally referred to as performance management. Performance management in turn implies measurement. Consequently the term performance measurement is used to establish measures and indicators that quantify performance objectives as a basis for planning targets and monitoring actual results. This information is used to assess and make judgments about whether the actual progress is adequate and what corrective action is needed.

8.1.1 Stewardship

Stewardship includes monitoring performance and communicating with stakeholders. Because resources are limited, directors must make sure they are well managed and used in a way that gets results. This is important, not only to the organization itself but also to the stakeholders who benefit from the organization’s activities or provide support. The Board’s responsibilities include supporting management when it communicates the organization’s activities, financial and other performance results to corporate members, providers of funding, appropriate government agencies, and other stakeholders.

1 This chapter draws heavily on the OHA's “Guide to Good Governance”.



8.2 PERFORMANCE MONITORING 8.2.1 How to Measure and Monitor Performance?2

There is an old adage that “What gets measured, gets done”. Measures of success (e.g. objectives) often define success, and the proper determination of a measure is vital to achieving the strategy. Good strategic and operational planning includes measurable objectives that reflect and build on actual results and achievements. This is not always easy for not-for-profit organizations whose legal purpose is often expressed in terms of meeting a social need. There are, essentially, two types of measurement: quantitative and qualitative. Quantitative measures record the incidence of events and other things that can be counted such as the number of people who received a particular service to a defined standard, etc. These measures, including financial results, can reflect the organization’s efficiency and effectiveness in getting things done. Qualitative measures deal with opinions and feelings – very important considerations for not-for-profits – and thus with the organization’s effectiveness in delivering the appropriate quality of service. Qualitative measures can be expressed in numbers by using such techniques as surveying people and recording the results; e.g. by asking people to rate their satisfaction on a scale of 1 to 10.

8.2.2 Performance Monitoring Standards

Accreditation Canada has laid out a set of standards for performance monitoring in its Standards for Sustainable Governance. These are reproduced at Appendix A to Chapter 1 of this Part (see Standard 13).

8.2.3 Board's Performance Monitoring Responsibilities

The Board is responsible for ensuring that management has adequate systems in place for: Monitoring organizational performance on a monthly, quarterly and annual basis, as

determined by the Board, such that: o The Perley Rideau’s operations are in conformity with all legal and regulatory

requirements and the organization’s values; o The Perley Rideau meets Accreditation Canada’s standards; o The Perley Rideau’s strategic directions and objectives are being fulfilled;

Reporting to corporate members, funders and other key stakeholders.

2 Adapted from the Chartered Accountants of Canada publication, “20 Questions Directors of Not-for-profit Organizations Should Ask about Governance” © 2006, question 18.



The Board must oversee the performance of seven key areas of responsibility: Fulfillment of mission, vision and strategy; Performance of Chief Executive Officer (CEO); Quality of care and services; Financial condition; Work force and human resources; External relationships; and The Board's own effectiveness.

The Board and management have established a process for monitoring and assessing performance on a regular basis. The process includes: Tools for assessment; Measures and indicators (primarily through scorecards and dashboards); and Assigned responsibility for providing the required information.

The Board uses measures wherever these can support its ability to assess and make judgments about its key areas of responsibility. Figure 1 – Board Responsibilities in Performance Management (found on the following page) – offers some general suggestions. However, the specific methodology used by the Board to measure performance is the review of scorecards and dashboards compiled on a regular basis by management. The Board has access to a plethora of formal and informal reports to assist in monitoring and evaluating the organization’s effectiveness. Collectively these comprise a diversity of perspectives that constitute a sound basis for informing the Board’s own perspective, including: Monthly, quarterly and annual scorecards and dashboards; Financial reports (quarterly reports and annual audited statements); MOHLTC Compliance Checks; Accreditation Canada reports; Resident Assessment Instrument – Minimum Dataset (RAI – MDS) reports Satisfaction surveys (residents and families, staff); Focus groups (with staff, families, volunteers, community, etc.); Board committee reports (including strategic assessments, etc.); and Board questionnaires. Audits: Management conducts monthly and quarterly audits, and reports its findings to the Board by way of the scorecards and dashboards. With respect to evaluating its own performance, the Board has a comprehensive process for assessing the effectiveness of its own governance, collectively and individually. (See Chapter 6, Part 2 for further detail.) In addition many of the Chapters in this Part on Stewardship contain checklists for reviewing various aspects of Board and Corporation performance.



Board Responsibilities in Performance Management

Board Responsibility Area

Board Approach to Performance Management

Use of Measures

MISSION, VALUES, VISION AND STRATEGIC

DIRECTIONS

Direct role of Board to assess the implementation of the strategic plan at least annually.

Assess qualitatively and quantitatively the progress in implementing the strategic directions and initiatives and accomplishing goals where these are measured.

EXECUTIVE

PERFORMANCE

Performance of CEO through annual evaluations and quarterly review.

For a discussion of tools, see Chapter 1 of Part 3 (e.g. core accountabilities and targeted objectives).

Oversee executive performance through assessment of Perley Rideau's results.

Assess accreditation and compliance audits, financial audits, satisfaction surveys, quality results, etc.

QUALITY OF CARE AND

SAFETY

Essentially an aspect of organizational performance related to executive performance (above).

Performance measures and indicators to monitor performance against commitments (i.e. Perley Rideau’s performance monitoring system).

WORKFORCE AND HUMAN RESOURCES



FINANCIAL CONDITION



EXTERNAL

RELATIONSHIPS

Direct role of Board to consider quality of external relationships with key stakeholders - e.g. MOHLTC, community and local agencies.

Qualitative assessment of quality of relationships, and of local health system integration.

BOARD'S OWN

EFFECTIVENESS

Various aspects to consider – essentially a qualitative assessment of Board processes and effectiveness.

For tools see Chapter 1 of this part (Part 4), Appendix A: Accreditation Canada’s Governance Standards; and Appendix B: Governance Review Checklist.



8.3 PERFORMANCE MANAGEMENT 8.3.1 Factors Affecting Performance Management for the Board

The Board oversees the organization's performance through its oversight of the CEO's and management's overall performance. To do so requires measures indicative of results. Many factors must be considered in framing a performance monitoring system that will serve the Board. Linkages between Strategic Planning and Annual Plans A sound performance management and measurement system connects the strategic plan to the annual operating performance. Strategic plans should have measures of performance for a longer time frame (three

to five years); As part of the strategic plan, there should be milestones for making progress to the

five-year vision (i.e. identify what should be achieved by the end of Year One and Year Three, etc.); and

Annual operating plans should establish corresponding one-year targets, possibly broken into measures of quarterly achievement.

Accountability Agreements and Measurement Accountability agreements between the Ministry of Health and Long-Term Care and the Perley Rideau provide the basis for reporting results to government. These accountability agreements cover a wide range of performance indicators and service volumes. Signatories are bound by the performance commitments in the defined performance areas which include: Financial health; Resident and client care and access; Organizational health; and System integration.

The Perley Rideau's performance monitoring system must track the performance in the defined areas. Accordingly, the Board will need to review these measures in carrying out its performance oversight responsibility. Good Reporting A sound measurement and reporting system has the following specifications:

Actual performance compared to planned results (targets);



Actual performance compared to available benchmarks from like facilities, where available;

Actual performance compared to acceptable standards and ranges; and Variances to the above, with management’s explanation of significant variances.

8.3.2 Performance Reporting

Perley Rideau management has developed a Performance and Risk Monitoring Framework, both for the use of management and for reporting to the Board. It is built upon the most recent four strategic directives and is aligned with the Strategic Plan. Indicators are reviewed and refreshed annually. On the following pages are found three graphics which illustrate the Performance and Risk Monitoring Framework, the Board-level Performance & Risk Monitoring Summary, and a sample Organizational Performance Scorecard:



Perley Rideau Performance and Risk Monitoring Framework – 2017

Board‐level Performance & Risk Monitoring Summary



Sample Organizational Performance Scorecard



8.3.3 The Board's Use of Performance Monitoring Reports

The Board's principal fiduciary responsibility is overseeing how well the Perley Rideau is accomplishing its mandate and mission. Therefore the Board needs information to do that, and it must act to ensure that it is receiving reliable and sufficient information to discharge its responsibilities. However, what is the Board to do as a consequence of the information it receives? For example, the Board must respect the line between the Board's role and executive management's role. The CEO is expected to take corrective action to address operational performance problems. The reality is that the Board may not have the competence to know what corrective action is needed. In certain circumstances, the Board may deem that there is urgency and imminent potential damage to the organization and may direct corrective action itself. (However, organizational priorities and opportunities may be forfeited in the process.) Where the available information suggests a performance problem related to its own effectiveness, the Board takes its own action. Potentially, the Board might also feel the need to get directly involved about urgent matters related to external relations and major strategic direction programs (such as the creation of the Seniors’ Village). If the Board decides to intervene directly, it should be sure that it is focusing on a potentially systemic problem or something posing a significant potentially damaging situation to the corporation, rather than chasing anecdotal feedback. Where performance is consistently positive, the Board should find ways to acknowledge good performance and reinforce such behaviour.

8.3.4 Reviewing Performance Management Regular review of the Perley Rideau performance management system is essential to sound stewardship. As discussed, currently, this includes monthly, quarterly, and annual operational scorecards and risk measurement dashboards. Additionally, the Board should review Accreditation Canada’s Standards for Performance Monitoring. Finally, in Appendix A to this Chapter there is a Review Checklist for Performance Monitoring System for assessing the fulfillment of the Board’s responsibilities for performance management.

*************



Appendix A


REVIEW CHECKLIST FOR PERFORMANCE MONITORING SYSTEM

1. The Board is satisfied that the Perley Rideau has in place effective systems for the

performance monitoring, analysis and reporting on all aspects of corporate performance including: a. Fiduciary obligations; b. Strategic planning; c. Executive performance; d. Resident and client well-being and satisfaction; e. Financial health; f. Resource stewardship; g. Risk management; h. Stakeholder relations; and i. Board governance.

2. The Perley Rideau seeks performance feedback from all major stakeholder groups

(including clients and residents, staff and volunteers, elected and government officials, evaluators engaged in audits, accreditation and certification processes.)

3. With respect to the many aspects of the Perley Rideau’s performance monitoring

system’s subcomponents: a. Processes are well documented and understood by those using these systems; b. Findings are systematically recorded and analyzed; c. Variances from expected performance are explained; d. Results and recommendations are summarized and reported to the Board by senior

management.

4. Management has adequate resources for implementing and maintaining an appropriate level of organizational performance monitoring.

5. The Board assesses the product of the performance monitoring system against the

backdrop of an up-to-date environmental scan. 6. The Board has effective means for:

a. Integrating performance information from the multiple governance and management perspectives of the organization;

b. Evaluating the effectiveness of the performance monitoring system in fulfilling the mission, vision and strategic objectives of the corporation; and

c. Evaluating the consequent outcomes in meeting community requirements.



7. The Board uses performance monitoring information in its strategic planning and decision making to improve future performance.

8. The Board relies on a blend of quantitative measures and qualitative feedback in

assessing the efficiency and effectiveness of the Perley Rideau’s Performance Monitoring System.

9. The Board regularly:

a. Reviews and evaluates the relevance and reliability of the performance measures being monitored by management and reported to the Board; and

b. Reviews the adequacy of its own performance evaluation processes (including those for collective Board and Committee evaluations, Chair and Committee Chair evaluations, and assessments of individual members’ performance).

10. The Board seeks continual improvement in the effectiveness of the Perley Rideau’s performance monitoring system.

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